Leasing commercial real estate gets more complicated every year. Not so long ago, we used to see commercial leases that were ten pages long. Today, they are often fifty pages or longer, sometimes with dozens of additional pages of exhibits. Commercial leases often last for many years. They can involve very substantial amounts of money. A landlord or tenant can find himself or herself locked into a long term commitment that is not what was expected.
When we represent a landlord, we try to keep the lease to a reasonable length and not include things which really don’t need to be addressed, or which repeat things said earlier. While it is important to protect the landlord’s interests, this should be done as efficiently as possible. Making a lease longer does not make it better, and can make it harder for the landlord to understand and monitor.
When we represent a tenant, we may not be able to make the lease shorter, but we can identify and point out the many clauses which may be very dangerous to the tenant, and negotiate with the landlord in hopes of eliminating them.
Like real estate contracts, leases are often preceded by a Letter of Intent (“LOI”), typically negotiated with a real estate broker. However, the actual lease, which is typically drafted by an attorney, not the broker, can be far different than what the LOI led the tenant to expect. It is important that every word of a commercial lease be carefully reviewed. Starting up a business in a new location is difficult enough without having unexpected lease problems cropping up after the lease is signed.