Commercial Lease document on wooden table

A commercial lease is a contractual agreement for a business to rent office space or other property from a landlord. The lease is for business activities, as opposed to a residential lease for housing. Compared to residential lessees, commercial lessees are subject to less protections – buyer beware! Florida Statutes Chapter 83 Part I covers commercial leases. Whereas a residential lessee can rely on housing and consumer protection laws, a commercial lessee cannot usually rely on rights other than those explicitly stated in the lease agreement. 

What Should I Expect in a Commercial Lease?

A commercial lease should be set out the rights and obligations of both parties. Oral leases are enforceable, but leases longer than one year may need to be in writing unless certain exceptions are triggered under the Statute of Frauds. For example, an oral lease that is payable monthly is known as a month-to-month tenancy at will (no fixed term, automatically renewed monthly), and is enforceable even if the lease term exceeds a year. A commercial lease will often contain the following clauses:

• Basic terms (lease length, permitted property uses, options to extend or cancel, rent, utilities, additional charges, security deposits, ADA compliance, etc.)

• A subletting clause, allowing the lessee to assign the lease payments to a third party. Oftentimes, the landlord will require the original tenant to guarantee the third party’s payments and/or retain the privilege to thoroughly vet the new tenant before agreeing to the assignment.

• A clause specifying which party is responsible for common areas, routine maintenance, upkeep, cleaning, landscaping, renovations, insurance, etc.

• A covenant of continuous operation, an obligation on the part of the tenant to continue to operate the business at the leased premises, in addition to paying rent.

• An arbitration clause, requiring the parties to accept a neutral arbitrator’s decision in the event of a dispute

• A modification clause, allowing the parties modify the lease upon mutual agreement 

Generally, every clause in a commercial lease is enforceable if the parties mutually agree to it, unless it is illegal, unconscionable, or vague. Don’t be scared to negotiate! 

Commercial Lease Negotiation Tips

Prices are always negotiable. Does the landlord have the ability to raise rent? Exactly how much space is being rented? Don’t let these questions go unanswered. Tenants with the ability and willingness to sign long term leases have leverage to negotiate many of these terms.

Is there a Non-Compete Clause that prohibits the landlord from renting space to a competing business? This may be particularly important for retailers or certain professional services. 

How do parties free themselves from the lease? How do they provide notice of changes? There must be clear standards for communicating subleases, modifications, and disputes.

EPGD Business Law is located in beautiful Coral Gables, West Palm Beach and historic Washington D.C. Call us at (786) 837-6787, or contact us through the website to schedule a consultation.

*Disclaimer: this blog post is not intended to be legal advice. We highly recommend speaking to an attorney if you have any legal concerns. Contacting us through our website does not establish an attorney-client relationship.*

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Eric Gros-Dubois

Eric P. Gros-Dubois founded EPGD Business Law in 2013 and is the current head of the firm’s corporate, estate planning, and tax practice, and manages the firm’s Washington D.C. office. With a JD and MBA, and a specialization in finance, Eric is able to step back and view the legal world through a commercial lens while also acting as a trusted business advisor for his clients. He does his best to be solutions oriented, and tries to think like a business owner, not just a lawyer.


*The following comments are not intended to be treated as legal advice. The answer to your question is limited to the basic facts presented. Additional details may heavily alter our assessment and change the answer provided. For a more thorough review of your question please contact our office for a consultation.

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