“[R]ather complicated” is how one online overview of commercial leases describes that world for business principals seeking to understand and transact within it absent the close help of a proven commercial attorney well versed in real estate matters.
As that article notes, commercial leases are flatly different from their residential-related counterparts, and in many material ways.
For starters, many of the state and federal consumer protections applicable to residential lease particulars do not exist for parties negotiating and ultimately executing commercial lease agreements. Lawmakers simply assume “that business people are more knowledgeable.”
And, of course, there is far more nuance and complexity relevant to a commercial lease than is the case where a would-be tenant is signing an apartment rental contract.
Every business in Connecticut and elsewhere is unique, of course, which breeds singular considerations relevant to rental calculation, caps on increases, lease duration, improvements or modifications to property during the lease term and myriad other concerns.
Will a commercial lessee be able to expand business activities in new directions following lease execution? A forward-thinking business party might have insisted on a broadly worded “use clause” to address that potentiality.
And what about exclusivity? Business owners are understandably concerned when a rival sets up shop right next door. A contractual clause negotiated with a landlord owning multiple spaces can prevent that possibility.
Some entrepreneurs might want a legal entitlement to assign or sublet property to another party during its leased term. Commercial leases often allow for that — but only when negotiations seal the deal before execution.
“The failure to determine requirements prior to committing to a lease can lead to unfortunate consequences,” stresses the above-cited article.
Input from a seasoned real estate attorney can ensure that doesn’t happen.