{"id":24838,"date":"2021-01-24T15:54:02","date_gmt":"2021-01-24T10:24:02","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=24838"},"modified":"2023-04-24T16:15:10","modified_gmt":"2023-04-24T10:45:10","slug":"important-facts-related-to-commercial-lease-agreement","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/important-facts-related-to-commercial-lease-agreement\/","title":{"rendered":"What are the Important Facts Related To Commercial Lease Agreement?"},"content":{"rendered":"\n<p class=\"has-drop-cap\">A commercial lease agreement is a\ntype of contract that figures out the terms and conditions under a contract on\nwhich one party agrees to rent property of the other party. The lease agreement\nobliges the lessee to make regular payments for a fixed period in exchange for\nthe property of the landowner.<\/p>\n\n\n\n<p>Both the lessor and the lessee suffer the consequences if they fail to comply with the terms of the contract. The <a href=\"https:\/\/corpbiz.io\/commercial-rental-agreement\"><strong>commercial lease agreement<\/strong><\/a> is an agreement between the landlord and the tenant of rent the property with the intention of operating a business.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">On\nWhich Stage Lessee &amp; Lessor Requires Commercial Lease Agreements?<\/h2>\n\n\n\n<p>A commercial lease agreement is a\ntype of legal document in between the landlord and tenant. A commercial lease\nagreement is usually needed when the property is leased for a longer period of\ntime, between 1 to 5 years or even longer. In such cases, a lease agreement\nplays an important role in maintaining the relationship between the landlord\nand the tenant and by passes the provisions that legally bind them.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What are the Types of Commercial Lease Agreement?<\/h2>\n\n\n\n<p>The below listed are the types of commercial\nlease agreement, which are as follows:-<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Gross Lease Agreement<\/h3>\n\n\n\n<p>Gross leases are also popularly known\nas full-service leases. It is a type of lease where the landlord pays all the\nexpenses of the property out of the rent received from the tenant. The list of\nsuch expenses includes taxes, insurance and maintenance. <\/p>\n\n\n\n<p>While the landlord takes all\nresponsibility for the building, the tenant only has to focus on the business.\nThis is one of the important benefits of gross leasing, which is used for\nmulti-tenant buildings.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Net Lease<\/h3>\n\n\n\n<p>A net lease is a commercial real\nestate lease in which, the tenant not only pays for his or her occupied space,\nbut also for a fixed portion of all. These costs are usually associated with\nthe operation or maintenance of the property. <\/p>\n\n\n\n<p>The list of such common costs\nincludes taxes, property insurance, property management fees or payments for\nutilities. The net lease can further be divided as the following category,\nwhich are:-<\/p>\n\n\n\n<ul><li>Single Net\nLease<\/li><li>Double Net\nLease<\/li><li>Triple Net\nLease<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Modified Gross Lease<\/h3>\n\n\n\n<p>A\nmodified gross lease is similar to a gross lease, except for a few things.\nAlthough the tenant is requested to rent in a lump sum, there is scope for\nagreement between the parties. <\/p>\n\n\n\n<p>Parties\nto the agreement may negotiate costs that may be included in the base rental\nrate In addition; expenses such as utility bills and salary of watchman are\nexcluded from the list. A modified gross is more popular among the tenants.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What are the Necessary Clauses under the Commercial Lease Agreement?<\/h2>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" width=\"985\" height=\"889\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/01\/What-are-the-Necessary-Clauses-under-the-Commercial-Lease-Agreement.png\" alt=\"Clauses under the Commercial Lease Agreement\" class=\"wp-image-24839\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/01\/What-are-the-Necessary-Clauses-under-the-Commercial-Lease-Agreement.png 985w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/01\/What-are-the-Necessary-Clauses-under-the-Commercial-Lease-Agreement-300x271.png 300w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/01\/What-are-the-Necessary-Clauses-under-the-Commercial-Lease-Agreement-768x693.png 768w\" sizes=\"(max-width: 985px) 100vw, 985px\" \/><\/figure><\/div>\n\n\n\n<p>Listed\nbelow are the necessary clauses under the commercial lease agreement. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Competitor Clause<\/h3>\n\n\n\n<p>A\ncompetitor clause debars the landlord from selling or lease out the same space\nin the building where you are planning to shift.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Concessions\nin Rent<\/h3>\n\n\n\n<ul><li>Make sure that the landlord is in a decision to allow\nsome exemption for the same premises, similarly, exemption of rent allowed by\nthe landlord for 1-2 months prior beginning the lease period.<\/li><li>Other rebate or comforts includes the renovation costs\nfrom the end of landlord expenses.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Gross Rent\nLease or Net Rent Lease<\/h3>\n\n\n\n<ul><li>There shall be transparency about the components rather than the rent, likewise the <strong>property tax<\/strong><sup><a href=\"https:\/\/en.wikipedia.org\/wiki\/Property_tax\"><strong>[1]<\/strong><\/a><\/sup>, insurance, maintenance charges and common area expenses etc, between you and your landlord.<\/li><li>Within the gross rental agreement, you are liable to pay the rent along with the other expenses accordingly.<\/li><li>In a net lease agreement, you have to pay the basic rent only. The rent to be paid will be lower but make sure to get clear about all the incidental expenses. <\/li><li>Note the electricity meters and see if you will get a separate bill or combined it with another tenant. And how will each tenant\u2019s charges be ascertained and confirmed?<\/li><\/ul>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/is-india-ready-for-third-party-litigation-funding\/\">Analysis: Is India ready for Third Party Litigation Funding?<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A commercial lease agreement is a type of contract that figures out the terms and conditions under a contract on which one party agrees to rent property of the other party. The lease agreement obliges the lessee to make regular payments for a fixed period in exchange for the property of the landowner. Both the [&hellip;]<\/p>\n","protected":false},"author":32,"featured_media":24841,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[438],"tags":[1465],"acf":{"service_id":"69"},"authorName":"Komal Singh","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/12\/processed.jpeg","authorDescription":"Komal Singh is a Legal scholar, having diverse experience in scripting research papers, articles &amp; dissertations, which serves her main interest &amp; competent in drafting legal documents. She has polished her skills in dealing with the matter related to consumer affairs and now building intelligible Legal Content for Corpbiz.","postViews":5606,"readingTime":3,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/24838"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/32"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=24838"}],"version-history":[{"count":13,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/24838\/revisions"}],"predecessor-version":[{"id":55670,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/24838\/revisions\/55670"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/24841"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=24838"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=24838"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=24838"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}