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What is the severability clause in a commercial lease?

Severability Clause. The severability clause establishes that in the event a court invalidates a provision within the lease, the remaining terms of the lease remain enforceable. This provision ensures that the lease remains valid, notwithstanding any unenforceable provision.

What is a use clause in a lease?

A use clause limits the tenants conduct by outlining exactly how theyre permitted to use the space that they want to lease. A use clause be either prescriptive, defining what the tenant must do, or they can be restrictive, defining what the tenant is prohibited from doing.

What are the major components of a percentage lease?

A percentage lease has two components base rent (or minimum rent) and a percentage of the monthly or annual gross sales made on the premises.

What are the red flags in a commercial lease?

Furthermore, certain legal clauses can threaten your future tenancy, including your ability to sell your business. Several potential red flags to look out for include: Use Clause Restrictions, Demolition Clauses, Relocation Clauses, and Non-disturbance Clauses.

What is an exhibit in a lease?

Items that cannot be easily incorporated into the main body of text in a lease are customarily attached and referenced as an Exhibit. The most common exhibits to a lease are maps, drawings or plans showing the exact location of the premises leased (demised) in the lease.

What are typical clauses aspects of a commercial lease?

The Use Clause and Exclusive Clause A use clause limits how youll use the rented space. The limitations can be as broad as what business youll conduct there, as narrow as what specific services or products youll offer, or as nebulous as the quality level of your operation.

What is the most common type of commercial lease?

Gross leases are most common for commercial properties such as offices and retail space.

How do I write a letter of intent for a commercial lease?

Every LOI should include: the property address. the names of the tenant and the landlord. the size of the space you wish to lease and the suite number if applicable. the length of the lease term and move-in date. the rental rate and what itll include (whether utilities, janitorial services, and the like will be included)

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Bold look in the Commercial Lease Agreement

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