3 Important Issues to Address in a Commercial Lease

 Posted on February 20, 2025 in Real Estate

Commercial leases and residential leases are wildly different types of documents. Residential landlords know how all of their tenants will be using the property. The terms of residential leases are so similar across most rental housing that many rules, such as not making noise that will disturb the neighbors’ peace almost go unspoken. Commercial leases must be drafted specifically for the type of property involved, what kind of business activity it is suited to, the landlord’s preferences, and the tenant’s specific plans for the property. A lease for an antique shop opening on the ground floor of a mostly residential building would have to be quite different from a lease for a bar in the nightlife district. An experienced San Antonio, TX commercial leasing attorney can help make sure the right terms are included in your commercial leases. Legal disputes with commercial renters can quickly arise if the terms of a lease are unclear or silent on the wrong issue.

Can a Commercial Tenant Carry Out Renovations? 

One issue you will want to address in your commercial lease is what types of modifications the renter can make to your property. Unless the last tenant and your new prospective tenant ran similar types of businesses, some renovations will likely be necessary to let the new business operate in the space. For example, if your last tenant operated a martial arts studio and your new tenant will be opening a retail store, your new tenant may need to permanently install shelving or replace the flooring.

It is essential for landlords to determine ahead of time what types of changes to the property they would allow or prohibit. It may take some extra effort to find a tenant who can work within your boundaries, but this is worth it for landlords who do not want a potentially big repair job between tenants.

Your Tenant’s Insurance Obligations 

Residential renters normally need only fairly basic, inexpensive renter’s insurance. Commercial landlords must be more careful to ensure that your tenant is sufficiently insured. What types of insurance coverage you should require your tenant to carry - and carry yourself - depends on the type of commercial space you offer and your tenant’s intended usage.

Repair and Maintenance in a Commercial Lease 

Commercial lessees often take on greater responsibilities relating to repair and maintenance than residential renters would. Businesses that are renting space often handle most or all of the routine maintenance tasks themselves, while the landlord is responsible for repairs when things stop working. If you have any special equipment on your commercial property, you must clearly establish the tenant’s responsibilities towards maintaining this specific equipment.

Contact a San Antonio, TX Commercial Real Estate Lawyer 

Geoff Mayfield, Attorney at Law is highly experienced in helping commercial landlords create strong leases. Knowledgeable Bexar County, TX commercial leasing attorney Geoff Mayfield will work closely with you to draft the right lease for your specific property. Contact us at 210-535-0870 for a complimentary consultation.