Drafting a Commercial Lease

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Key areas

5 things you need to know about Drafting a Commercial Lease

  1. As a landlord it’s important that you provide your lessee with a commercial lease agreement that protects your interests and complies with the relevant legislation in the state you’re based. Be aware that each state has different requirements surrounding commercial lease agreements.
  2. One of the major points to determine before you put together your commercial lease agreement is whether it is a retail lease or a standard commercial lease. A retail lease is generally a lease for a premises which will be used to sell a product or service directly to the public. A cafe, for example, needs a retail lease.
  3. Once you’ve worked out if you need a retail lease or standard commercial lease, you need to agree on the major terms.  This includes the rent payable, whether an option period will be granted, and what type of security you will require from the lessee.  Security may include bond, a personal guarantee or a bank guarantee.
  4. Landlords can choose to enter into a bespoke commercial lease agreement with their lessees, or to use a state specific standard lease. The majority of landlords choose the state specific standard lease, produced by their state’s real estate institute or law society, and have their lawyer modify it to cater for their individual circumstances. Either option works well, but speak to lawyer to work out the best option for you.
  5. Finally, if you enter into a retail lease agreement with your lessee, you will be required to provide them with a disclosure document. Make sure you comply with this in order to ensure your lessee can’t get out of the lease due to your non-compliance.
Our Drafting a Commercial Lease Lawyers
Ursula Hogben Key Focus:

Commercial Law, Contract Law, Information Technology And Online Law, Intellectual Property, Capital Raising Law


Bank of America Merrill Lynch, Baker & McKenzie, Hogben Group

Emma Heuston
Emma Heuston Key Focus:

Franchises, Business And Commercial, Leasing


Everingham Solomons, Edney Ryan Legal, Attwood Marshall, Lexis Nexis Precedents Author, Academic Marker, University of New England Law School

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