Commercial Lease

What is it?
A commercial lease is a written contract between a landlord and business tenant. The agreement allows tenants to use the property for business-related purposes (e.g., such as setting up an office) within a specified period of time, in exchange for periodic payment. The lease also outlines the rights and responsibilities of both parties.

There are different components of a lease, which must be detailed.

  1. Rental Fees

    Perhaps the most important section of the lease, the rent clarifies how much the tenant owes the landlord and how the payment program will run. There are different types of rental plans:

    • Percentage Rent Lease
    • Gross Rent Lease
    • Net Rent Lease
    • Net Net (Double) Lease
    • Net Net Net (Triple) Lease
  2. Terms and Renewal
    The “Term” is the time period of the lease (e.g., 3 months, 8 months, etc.) and there should be an option to renew the lease near the end of the term. An automatic renewal option can be added in, so that tenants are permitted to stay within the property even after the term comes to an end, until the landlord notifies them otherwise.

  3. Taxes and Utilities
    Who pays for property taxes and such bills as gas, hydro, and electricity must be explicitly mentioned.

  4. Repairs and Insurance
    The lease must name the party responsible for fixing any damages that are present before the lease and that might occur during the term. This extends to property insurance too.

  5. Space and Services
    Exactly what falls within the borders of the property must be listed, as well as the services within, such as:

    • Percentage Rent Lease
    • Gross Rent Lease
    • Net Rent Lease
    • Net Net (Double) Lease
    • Net Net Net (Triple) Lease
  6. Permitted Use of Premises
    Likewise, the tenant must make the landlord aware of the type of business activity that will occur on or in the property. Business information need not be revealed, but some transparency is expected.

  7. Default and Disputes
    Some degree of friction between tenants and landlords is inevitable, which is why having a conflict-resolution procedure in place is absolutely vital.

What we do?
As opposed to a residential lease where people’s homes are on the line, courts presume that the parties to a commercial lease are knowledgeable and capable of negotiating for their own self-interest. As such, both parties are granted more leeway in their negotiations. This can prove to be a double-edged sword.

Our professionals at Prestige Law Firm are both experienced in drafting commercial leases and well-versed in the relevant provincial legislation. With these tools in-hand, we will fiercely negotiate on your behalf, whether you are a prospective tenant or landlord.

Our services include:

  • Drafting leases
  • Overlooking signage
  • Negotiating on your behalf
  • Informing you of your rights, provincial laws, and details of the lease
  • Enforcing provisions of the lease