Retail leasing

A commercial lease is meant to be an Agreement between the owner of a property and the person looking to initiate some sort of Businesses on that land.

[5] This commission amount is based on the agreement they are able to secure with the tenant in regards to terms such as rent and square footage.

[5] However, the tenant can hire their own independent broker to aid them in their search for commercial property to rent.

[6] A prospective tenant or landlord some become familiar with differences such as these to further their understanding of the law before entering into a lease agreement for the first time.

[8] In this type of agreement, the tenant pays one lump sum amount to the landlord in exchange for various services.

[8] In this type of agreement, the landlord receives a gross payment of rent from the tenant, who is also responsible for paying their own utilities.

This contract takes into account the rise in the expenses covered by the landlord by increasing the tenant's base rent each period.

[8] In this agreement type, a percentage of the tenant's gross revenue earned in operating their business may be required as payment to the landlord.

[8] What is described to be gross revenue can vary by lease agreement, some items are deducted in this calculation such as sales tax or returned products.

[8] In most cases, the terms of a commercial property lease agreement are negotiable between the tenant and landlord.

[8] This section of a lease agreement details what remodeling to the property will be covered by the tenant or landlord.

[8] This section is not generally included in a basic business lease agreement, but it may be requested by the tenant.

[8] It prevents the landlord from renting out additional property for use by another business operating in the sell of a similar product or service.

[8] Lease contracts may include terminology allowing a landlord the legal right to terminate a tenant's stay if they sell, tear down, or rehabilitate their building.

[6] Therefore, the choices, preferences and the division of responsibilities should be clearly mentioned in the agreement to avoid any confusion and legal issues.

[8] The SBA compiled a list of some of those factors to take into consideration:[8] Operating Requirements, Capital supply and Needs, Financing and Payment Flexibility, Resale Value, Equipment, and Taxes.

[10] This may disadvantage the tenant as it gives the landlord the ability to terminate their lease if the building is foreclosed upon.

[10] It allows them to continue operating in the space as long as they make their payments, subordinate their interests, and agree to recognize a new landlord if the property is sold or foreclosed.

[10] If a tenant did not include this clause they could be at risk of loss of business and an influx of new expenses due a change in location if there lease is terminated.

This means that they would assume all the previous landlord's rights and responsibilities listed and agreed upon in the lease agreement with the tenant.

[11] Spaces such as these are similar to commercial leases in that they are open to a variety of different business types, but several of the facilities within the building are shared.