Real estate developers invest a lot of money into their commercial buildings with the goal of filling them with good tenants. They research and conduct background checks to find businesses suitable for their property.
Therefore, it’s essential to have a solid leasing agreement that protects your interests. Every development has its unique features, but here are some items that should be in every landlord-tenant contract:
1. Leasing parties
The lease agreement should identify the landlord and the tenant, including their legal names (or the name of the tenant’s business), registered office address and contact information.
2. Description
There should be details of the property being leased, whether the entire building or a suite within the building. The lease should also include common areas, such as a lobby or restrooms.
3. Term of the lease
Specify the lease term’s start and end dates, including the renewal process once the term ends. There should also be a section outlining notification of potential rent increases.
4. Payment terms
The contract should state how much the tenant will pay, when it’s due and how it should be paid (check, direct transfer). It should also outline any additional costs, such as maintenance and utilities.
5. Security deposit
A security deposit serves as collateral for any damages caused by the tenant. The agreement needs to specify the deposit amount, the conditions under which it will be returned, and situations where the landlord may keep it.
6. Repairs and maintenance
The agreement should define who is responsible for maintaining and repairing the property. Typically, the tenant is responsible for interior repairs while the landlord attends to the property’s exterior.
7. Premise use
The contract needs to describe what the tenant can and can’t do on the property, including the type of business they can operate or changes to the space.
8. Termination
There should be terms under which either party can terminate the lease early, such as breach of contract or sale of the property.
9. Dispute resolution
Specify how disputes will be resolved, whether through mediation, arbitration or litigation.
A lease agreement is a legally binding document. It’s best to review it with someone to ensure that it complies with the rules and regulations and protects your interests.