Maryland Commercial Lease Attorney

A Commercial Lease is a Binding Agreement that Should be Mutually Beneficial for the Tenant and Landlord

Whether you own commercial property or are a tenant, a Frederick commercial lease attorney can protect your rights and help you make the most of the agreement. A business lease attorney lawyer can explain lease language, suggest changes, help you negotiate the terms, and resolve disputes that may happen in the future.

If you’re the tenant, the space you need may be critical to your success or cause your business to fail. If it’s at the right location, the right size, at a cost you can afford, it’s an important asset. You face enough challenges. You don’t need to add more with a bad lease for the wrong property.

If you’re the landlord, long-term relationships are critical to your success. You need to find the right tenants who will pay their rent in full and on time, ones who don’t cause you or other tenants problems. Evicting a tenant can be a long and expensive process, so you want to find the best tenant to reduce the risk of that happening.

A business lease lawyer can draft a document that’s specific to the property and the parties involved. There should be no boilerplate, fill-in-the-blank, “standard” commercial lease. Vague, non-specific language can cause legal headaches for either party and cause practical problems and confusion after a tenant moves in. You’re much more protected when a commercial lease attorney drafts a contract just for you and your property than when you use a lease you found on the internet.

If you’re a commercial landlord or a business owner looking to rent property, a commercial lease lawyer at Lusk Law, LLC, can review your lease agreement to make sure it’s legally sound and it protects your rights and interests. Call us today at (443) 535-9715, so we can discuss your needs and how we can help.

A Commercial Lease Attorney Will Help You Choose Which Type is Right for You

There are four types of commercial leases:

  • With a percentage lease, tenants pay a base rent each month, along with a fixed percentage of their monthly sales.
  • Gross leases include all of the property owner’s costs – insurance, property taxes, and maintenance – in the monthly rent payment.
  • Net leases require the tenants to pay for some or all of those costs.
  • Hybrid leases include aspects of both gross and net leases.

Which one is best for you depends on the circumstances and your goals. A Frederick commercial lease attorney can discuss your needs, the problems you want to prevent and help you choose which options are the best fit.

What Agreements Can a Business Lease Attorney Provide?

Gross lease: A gross lease establishes a fixed, monthly rent amount. This type of lease is common in buildings with multiple tenants. The rent covers property taxes, maintenance, and the landlord’s property insurance costs.

Percentage lease: This lease helps businesses whose income varies considerably during a year, because the base rent is usually lower than they’d pay with a standard gross lease. Retail shops, for example, pay less rent in slower months than they do during the holiday shopping season.

Net lease. There are three types of net leases – single, double, and triple.

  • A single net lease requires tenants to pay property taxes and rent. The landlord pays for other operating expenses, including maintenance and repairs.
  • A double net lease requires tenants to pay rent, property taxes, and insurance premiums. In multiple-tenant buildings, the landlord may assign those costs proportionately to each one. The landlord pays for structural maintenance.
  • A triple net lease requires tenants to pay property taxes, insurance premiums, maintenance, and repair costs. The tenant may or may not pay utilities. This lease is also called an NNN lease or an absolute net lease. But it’s not a true absolute net lease unless the tenant pays all costs of occupying a property, including utilities.

Modified Net Lease: If a landlord presents a tenant with a net lease and the tenant wants to avoid paying some of the costs, the tenant can ask for a modified net lease, the terms of which are created through landlord-tenant negotiation.

For example, a tenant may be reluctant to pay for structural repairs in an aging building. A modified net lease could specify that the tenant is responsible for structural repairs only up to a specific dollar amount, with the owner paying above it.

Risks a Business Lease Lawyer May Limit or Avoid Through Lease Language

Tenants should carefully review all clauses within a lease:

  • What are your rights if the landlord sells the building?
  • What happens if a fire or natural disaster makes your space unusable?
  • What are your obligations if you decide to shutter your business before the end of the lease term?

Any lease you sign should answer those questions.

If you’re a tenant with a net lease requiring you to pay for maintenance or repairs, you must understand your obligations:

  • Do you pay the landlord’s flood insurance premiums?
  • Does the owner require you to obtain flood insurance for the property you’re renting?
  • Do you pay to repair damage caused by the owner or another tenant?

If you’re a landlord and require tenants to carry insurance on your property, you may not know if the tenant stops paying premiums and the insurer cancels the policy unless you’re added as an additional insured on the policy. However, to ensure that any potential losses are covered, you may wish to pay the premiums yourself and pass those costs on to the tenant.

Given the possible costs of problems a commercial tenant and property owner may face, it’s in your interests to limit the chances one may happen through a properly worded contract drafted by a business lease lawyer.

Other Issues the Parties and Their Business Lease Attorneys Must Consider

There are many practical issues you and your commercial lease agreement lawyer should consider, including:

  • How is the area zoned? Unless you get approval from the local zoning authority, there can’t be a commercial business in an industrial zone or an industrial use in a commercial zone.
  • Can the tenant afford the rent? If it’s an existing business, the owner should have a good idea of their cash flow. If it’s new, does the tenant have the financial resources to pay the rent if the company gets off to a bad start?
  • How long should the term be? The longer it is, the longer the tenant may be tied to a space that’s not good for the business. It may grow more than the tenant thought, or demand may unexpectedly shrink. A short-term lease may be better for a tenant than one that’s five to ten years long (though the rent may be higher). If the building and the business are a good fit, the tenant could negotiate a longer term. A landlord wants a steady, long-term, reliable income stream, so may prefer a longer lease. If you want to lease a space to a riskier business, a short-term lease may be the way to go.
  • Does the existing space need to be modified? Does the tenant need to create rooms, install heavy equipment, re-wire the space, or create a loading dock? Can these changes be made? If so, is the landlord willing to pay for some or all of them?
  • Will the prospective tenant’s business cause problems for other tenants? Will it cause loud noises, emit smoke or fumes, smell bad, or generate traffic and demand for too many parking spaces? Can the space be modified or equipment installed to limit potential problems? Lease language may prohibit the tenant from doing certain things on the premises and or take remedial action if there are complaints.
  • If a tenant counts on walk-in traffic by customers, can there be a sign on the property and or by the road? If so, how big can it be? This could be a problem with the landlord and/or zoning rules, too.
  • If the space is one of many units, can the landlord lease space to a competitor? A tenant won’t want a competing business three doors down.

Have Questions? Contact An Experienced Frederick Commercial Lease Attorney Today

Leases are lengthy, complex documents, but even one incorrect or omitted word could lead to litigation if a dispute arises. Whether you’re a landlord or a potential tenant, don’t enter into a lease agreement until you have a Frederick commercial lease lawyer review it.

Call Lusk Law, LLC today at (443) 535-9715 or fill out our online form to request a consultation with one of our business lease lawyers. We are Advocates For Life’s Obstacles and Opportunities.

Attorney Rebekah Damen Lusk

Rebekah Damen Lusk is the Founder and Managing Member of Lusk Law, LLC. Rebekah brings personal experiences as a small business owner, real estate investor, landlord, and farm owner to the task of practicing law and working with clients. Her practice areas include general civil litigation, business, employment, landlord/tenant, real estate, and equine/animal law. [ Attorney Bio ]