In order to rent the property, a financial contract is signed between the landlord and the business owner to facilitate the intended buyers. This contract is known as the commercial lease. Usually, the business owners find it really hard to buy a property hence they prefer to get it on rent. In this way, they are able to save some capital which otherwise would have been difficult to do in case you are buying the same. Many people often think that there is hardly any difference between the commercial and the residential lease. Both are different types of leases but have nothing in common. They might be different types of leases but are extremely different from one another. Under commercial lease solicitor, it is very important to learn about the responsibilities, rights, and the liabilities related to both the parties.
Defining commercial lease
It is a kind of agreement signed for the sake of business. The purpose is to get a property to set up or run the business from the owner or the landlord which you cannot actually buy. The word commercial associated with the lease is itself evidence that the purpose of these leases is to cater the business purposes. It has nothing to do with the domestic property or any other construction that is meant for the housing, accommodation or residence. The two parties involved in the commercial lease system are referred to as the landlord and the tenants. The tenants are the ones who get the property on lease and can own a small or a large business.
Types of commercial leases
The two basic types of a commercial lease are monthly and the annual leases. Besides these two classifications the other types are as follows:
- Net lease is the kind of commercial lease in which the tenant is liable to pay either complete or some part of the costs covering maintenance, tax and insurance.
- Double net lease includes the payment of the taxes, rent and insurance by the tenant.
- Triple net lease includes the payment of rent, insurance, maintenance and taxes.
- Percentage lease is of a particular kind because here in this case of lease a certain percentage is decided against the sales and profits made by the tenants.
- Fully serviced lease as the name indicates comprises of all the utilities and services that the tenant pays in different portions in other conditions. This s feasible when there are multiple tenants involved in a business.
At the time of signing the lease, it is very important to mention what kind of lease is required. It is the type and category of the lease that will further determine the other details of the rent. The terms and conditions are negotiable but there are certain specific features that are associated with each of these types and are integral to them only.