Smith + Schwartzstein
Located In Morristown, NJ and New York, NY

Commercial leases: What you should know

Making sure your commercial lease agreement is a good arrangement is important to the health of your relationship with your landlord or the property owner. A commercial lease is your contract dictating how much you pay, what kinds of additional expenses there are in the building and other rules and regulations.

Commercial leases are significantly more complicated than residential leases, and the terms of contracts could vary between each lease. There is a lot of room for negotiation in some leases, while others are simple and straightforward.

Some of the main differences between residential and commercial leases is that a commercial lease provides less legal protection, is more negotiable and can have varied terms. For example, commercial leases aren't protected by consumer laws. There are fewer protections because of the assumption that business people are aware of the terms in contracts and will take steps to protect themselves.

The terms of agreements vary thanks to the different needs of each tenant. Landlords may create completely customized leases for specific tenants, so no two are exactly alike.

Finally, the commercial lease is normally negotiable. You may ask to extend the lease for a lower monthly rate or want to limit the length of the lease in exchange for paying extra utilities; the options are open, it just depends on the situation.

For most commercial transactions, it's a good idea to work with your attorney. The contracts are complicated and may vary each time you seek updates or changes. It's wise to always have a professional look over the legal document before signing.

Source: FindLaw, "Commercial Lease Agreement Overview," accessed June 06, 2018

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