Published on Wednesday, 27 June 2012
It is advisable for landlords to have a ready-made template for lease agreements for commercial renting. A commercial rental agreement is a document presenting a written binding agreement between property owner and tenant. The lease agreement includes all the responsibilities, rights and conditions of the tenants, as well as those of the owner/landlord and states all the regulations that have to be followed during the tenancy.The template itself doesn't have to be changed for each new agreement; usually the landlord or owner only has to change specific parts of it, such as rent responsibilities and information on the property.
It is hard to get a standard form for a lease contract for commercial property. However, using a template can ease the process of preparing this agreement. The owner's details, for example, can be filled in the template form, since this is consistent information. If the owner has experience with rental agreements, they should be aware of their basic requirements which apply to each new tenant and don't need reconsideration. Once the tenant and the owner sign the lease agreement, it becomes legally binding.
There are several things that have to be included in a commercial rental agreement. Firstly, the tenant and the owner's names must be spelled correctly. The address of the property should also be filled in and if there is more than one property leased, each property can have its own contract or both places can be included in the same agreement.The contract records the dates of commencing and termination of the lease. The beginning date of the contract isn't necessarily the day when the tenant moves in, but from that date rent begins to be calculated. The end date on the contract is when the tenant agrees to vacate the space or renew the contract. One of the critical points of the commercial rental agreement is determining the amount of rent. The rent and the due dates should be outlined in the agreement too, as well as a security deposit (if any).
The length of the agreement is decided by tenant and owner for whatever period. Often tenants choose a longer period of occupation if the lease terms are good. A short rental period is usually for a year or shorter and is common practice too. The rent amount for a commercial rental is usually based on the size, so the space should be measured before any agreement is signed. There are two terms which can influence the details in the lease agreement template: the use clauses and the exclusivity conditions. The first one explains the way the property should be used. The exclusivity conditions state whether the tenant will occupy exclusively the space or other companies will work in the same place. These clauses are important parts of the commercial rental agreement because the tenant would never be pleased to have competitors in the same building. When it comes to business, there are many factors which affect its success, so renting a commercial space has to be beneficial for all the involved parties. It is essential for tenant and owner to fully understand the terms and conditions of the signed agreement. If the tenant finds anything on the contract which bothers them, they should seek clarification. The best way to do that is by hiring a real-estate attorney who would read the contract in simple words and can prevent a potential mistake.
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