Introduction and Overview
A commercial lease is the binding contract that sets out the terms on which the owner of a property, the landlord, will allow a tenant to use it. A lease is a complex legal document and it is strongly recommended that you take legal advice before granting or taking a lease.
The lease will cover, in detail:
- Demise – the physical area the lease covers;
- Rights – whether the landlord retains any rights or whether the tenant has rights over any other property, owned by the landlord or otherwise;
- Term – how long the lease will run for;
- Rent – how much the tenant must pay and when;
- Insurance – who insures what and who pays;
- Outgoings – who is responsible for what;
- Repair & Maintenance – who is responsible for what and who pays;
- Alterations – what the tenant can do to the property;
- Use – what the tenant can do in the property;
- Selling / Sub-letting – whether the tenant can sell on or sub-let the property; and
- Legislation – who is responsible for compliance.
The lease will also cover a number of other topics and can vary in length from a few pages to over fifty. Usually, the longer the term of the lease, the longer the physical document because it will seek to cover every eventuality that might arise during the term so it is clear who is responsible for what in each case.
In this series of articles, we are aiming to give you a brief overview of the principal areas covered by a commercial lease. These articles are for guidance only and do not represent legal advice. If you need advice or assistance on leases or any other property concern, please do not hesitate to contact Andrew Rannie, Head of the Property Department for a free initial consultation.