Are commercial leases negotiable?

On Behalf of | Jun 1, 2017 | Real Estate Disputes

Like any other contract, business owners in Fort Lauderdale, Florida, are allowed to negotiate their commercial leases. In fact, negotiation is often something a prospective landlord expects, which means the first lease proposal or draft contract should be read more as a wish list of what a lease would look like to the landlord if they had everything they wanted.

The tenant should, therefore, not be merely content with accepting unfavorable terms in a lease and should instead look at several important parts of the proposed lease agreement to see if those terms work for the business’s needs. If they do not, then the owner should not hesitate to make a counteroffer or propose their own lease terms to the landlord.

For example, rent is not usually a take it or leave it proposition in a commercial lease. If the tenant feels like the rent is too high, the tenant can ask for a lower rent, although the tenant will usually need some proof in support of their position. Likewise, a lease can limit a landlord’s ability to impose rent increases. What is or is not included with the rent is another topic of negotiation.

Along with rent, a tenant should consider negotiating the term of the lease, as a shorter lease usually gives more freedom to a tenant, while a longer lease offers more reliable income to the landlord. What can and cannot be done with the property in the way of improvements, business use or subleasing are also areas where a tenant may be able to obtain more favorable terms.

A commercial real estate dispute does not just include litigation but can also include having to negotiate the terms of a commercial lease. An experienced real estate attorney who practices in the Broward County area can be very helpful in resolving these disputes effectively.

Source: FindLaw, “Negotiating a Lease for Commercial Real Estate,” Accessed May 29, 2017