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Negotiating a commercial property lease agreement

Thursday, 10 September 2015

clip_image002As discussed in our previous article, “a guide to leasing property for small & medium businesses”, a commercial property lease agreement is a legally binding contract between the landlord and the tenant. Before signing a lease agreement it is vital that you understand every term and condition stated in the contract and the agreement meets your business requirements. You may need to negotiate some of the terms in the agreement in order for the lease of the building to work effectively for your business needs. This article highlights some of the terms and conditions you need to be aware of in order to achieve this.

The landlord should make your requirements very clear within the lease agreement. Amongst other aspects of the lease agreement, your liabilities, the duration and the cost of the lease must be unequivocally defined. The agreement should also clearly state who the landlord is and if applicable, any superior landlords.

One of the most critical aspects of a lease agreement, from a tenant’s perspective, is the physical properties of the building and the terms of use. The agreement should clearly detail the boundaries of the property, along with all points of access and if the property is shared by multiple businesses or tenants, the agreement should state which access points and areas of the building are shared. Additionally, the agreement must detail any limitations that may restrict the hours of use, any restrictions in the building’s type of use and any legal obligations that come with the property. The lease should also cover any planning constraints which may restrict future building development should you wish to expand the property.

If you find any terms that may limit your business, it is advisable that new terms are negotiated between both parties. It is important that this is done in writing and responses from your landlord are in writing too. Once you have formed an amicable agreement you should double check the terms of the new lease to ensure that your newly negotiated terms have been accurately portrayed in the agreement.

It is recommend that you seek qualified legal assistance from experienced commercial property solicitors during the process of securing the lease of business premises. There are many aspects to a lease agreement and without professional help you could be left with a property or a lease that is a hindrance to your business.

Rollingsons can protect your interests in all commercial property-related matters. For more information or to arrange an initial consultation, please contact us on 0207 7611 4848.

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