It’s a big investment for any business to sign a commercial lease agreement. The agreements in a contract between a landlord and lessee can either help or overwhelm. Especially with different interpretations, a contract can create if vague language exists. Some terms to consider are the length of lease, rent, and whether a lease is net or fully-serviced. It’s in the best interest of an incoming business and the property owner to fully understand their entitlements or lack thereof.
Commercial lease agreements do not use the same guidelines a residential lease does nor benefit from any government assistance unless health and safety reasons are present. Commercial lease agreements are typically at the mercy of solely what was agreed upon between parties. With that in mind, it is standard to detail what kind of lease it is to have fundamental talk points normal to any lease negotiation. The type of lease should address customary grounds, such as whether it’s a fully-serviced lease with standard amenities included in the rent, net lease with rent being a separate cost from amenities or a percentage lease landowner takes a percentage of profits. These are expected conversations between both a landlord and renter and should only be start points for negotiations.
Other conversations should identify but not limit property maintenance, exclusive use, sublease opportunity, and the Americans with Disabilities Act. For example, if the property needs an unexpected change to better accommodate Americans with Disabilities or a similar business will give an existing company competition, these are crucial inconveniences to both parties if no specific text is available in the contract to regulate such glitches. Even more so, in the event of a dispute, one party can unfairly have leverage over the other.
In the end, each side needs to determine what’s important for their business’s success and make it a point of emphasis in contract dialogue, but also not to overlook details not directly associated with their business. Because vague text will be explicitly based on what’s convenient to each side, and when this occurs, if a dispute does not go through a court system, both sides will have to settle on an arbitrator’s judgment of the disagreement.