Free Commercial Lease Agreement Template

COMMERCIAL LEASE AGREEMENT

This Lease is made on [DATE] between [LANDLORD LEGAL NAME], [ADDRESS] ("Landlord"), and [TENANT LEGAL NAME], a [STATE] [entity type], [ADDRESS] ("Tenant").

1. PREMISES. Approximately [NUMBER] rentable square feet at [ADDRESS, SUITE], shown in Exhibit A ("Premises"), in the building or center known as [NAME] ("Property"), with non-exclusive use of common areas and [NUMBER] parking spaces.

2. TERM. [NUMBER] years, starting on the later of [DATE] or delivery of the Premises with Landlord's Work substantially complete ("Commencement Date").

3. BASE RENT. $[AMOUNT] per rentable square foot per year ($[AMOUNT] per month), payable monthly in advance, increasing by [3]% on each anniversary of the Commencement Date. Base rent is abated for the first [NUMBER] months.

4. OPERATING EXPENSES (CAM). Tenant will pay its pro rata share ([PERCENT]%) of the Property's reasonable operating expenses, real estate taxes and insurance, paid monthly based on Landlord's good-faith annual estimate and reconciled within [120] days after each year with supporting detail. Operating expenses exclude: capital improvements (except those reducing operating costs, amortised over their useful life); debt service and ground rent; leasing commissions and costs of leasing other space; costs caused by Landlord's negligence or violations of law; management fees above [PERCENT]% of gross revenues; and costs reimbursed by insurance or other tenants. Increases in controllable operating expenses are capped at [5]% per year, cumulative. Tenant may audit Landlord's records within [12] months after each reconciliation; if Tenant was overcharged by more than [3]%, Landlord pays for the audit.

5. SECURITY DEPOSIT. $[AMOUNT], reduced to $[AMOUNT] after [12] months of timely payment, returned within [30] days after the Lease ends, less amounts owed.

6. LANDLORD'S WORK AND DELIVERY. Landlord will deliver the Premises with [DESCRIBE, e.g., HVAC, electrical, plumbing and roof in good working order and compliant with applicable codes, including accessibility] at its cost. If delivery is more than [60] days late, Tenant receives [one day of free rent for each day of delay]; if more than [120] days late, Tenant may terminate.

7. TENANT IMPROVEMENTS. Landlord will provide an allowance of $[AMOUNT] per square foot for Tenant's approved improvements, paid [within 30 days after completion and lien waivers]. Tenant may make non-structural alterations costing less than $[AMOUNT] without consent. Tenant's trade fixtures and equipment remain Tenant's property.

8. USE. [DESCRIBE PERMITTED USE] and related lawful uses. Landlord represents that this use is permitted under current zoning. If Tenant cannot obtain required permits for its use by [DATE] despite diligent efforts, Tenant may terminate and recover its deposit.

9. EXCLUSIVE USE. Landlord will not lease or permit any other space in the Property to be used primarily for [DESCRIBE]. If this is breached, Tenant's base rent is reduced by [50]% until cured, and Tenant may terminate if not cured within [90] days.

10. REPAIRS AND MAINTENANCE. Landlord will maintain, repair and replace the roof, structure, foundation, exterior walls, common areas and building systems serving the Premises [including replacement of the HVAC unit]. Tenant will maintain the interior of the Premises and [routine HVAC servicing under a maintenance contract]. Landlord will make repairs within a reasonable time after notice; if an interruption caused by Landlord lasts more than [5] business days and makes the Premises unusable, rent abates until restored.

11. INSURANCE AND INDEMNITY. Tenant will carry commercial general liability insurance of at least $[AMOUNT] per occurrence, naming Landlord as additional insured, and property insurance on its own property. Landlord will insure the building. Each party waives claims against the other to the extent covered by its property insurance. Each party will indemnify the other against third-party claims caused by its own negligence or breach.

12. CASUALTY AND CONDEMNATION. If the Premises are damaged and not restored within [180] days, either party may terminate. Rent abates in proportion to the unusable area.

13. ASSIGNMENT AND SUBLETTING. Tenant may assign or sublet with Landlord's consent, not unreasonably withheld, conditioned or delayed. Consent is not required for assignment to an affiliate, a successor by merger, or a buyer of substantially all of Tenant's business at the Premises with net worth at least equal to Tenant's at signing. On an approved assignment, Tenant and any guarantor are released from obligations accruing afterward.

14. RENEWAL OPTIONS. Tenant has [2] options to renew for [5] years each, exercisable by written notice [9] to [12] months before expiry, at [95]% of fair market rent, determined by agreement or, failing agreement, by independent broker appraisal.

15. RELOCATION. Landlord has no right to relocate Tenant.

16. GUARANTEE. [No personal guarantee. / Limited guarantee in Exhibit C, capped at [NUMBER] months of base rent, ending after [NUMBER] months of timely payment, with a good-guy release.]

17. SIGNAGE. Tenant may install signage on [storefront / building / monument] at its cost, subject to code and reasonable Landlord criteria.

18. DEFAULT. Tenant defaults if rent is unpaid [10] days after written notice, or if Tenant fails to cure any other breach within [30] days after written notice (or longer if reasonably needed and Tenant is diligently curing). On default, Landlord may pursue remedies permitted by law, must use reasonable efforts to re-let the Premises to mitigate damages, and may not use self-help lockout without a court order. Landlord defaults if it fails to perform within [30] days after notice; Tenant may then cure and offset reasonable costs against rent.

19. SUBORDINATION AND ESTOPPEL. This Lease is subordinate to Landlord's mortgage only if the lender agrees not to disturb Tenant's possession while Tenant is not in default. Each party will provide estoppel certificates on reasonable request.

20. SURRENDER AND HOLDOVER. At the end of the term, Tenant will return the Premises broom clean, normal wear and tear and casualty excepted. Tenant need not remove approved improvements unless Landlord required removal when consenting. Holdover rent is [125]% of the last base rent.

21. GOVERNING LAW. This Lease is governed by the laws of [STATE].

GENERAL PROVISIONS
(a) Notices. Notices must be in writing and sent to the addresses or emails above (or as later updated by notice). Email notice is effective when sent, unless the sender receives a delivery failure message.
(b) Entire agreement. This agreement, with any schedules and exhibits, is the entire agreement between the parties on its subject and replaces all prior discussions and agreements on that subject.
(c) Amendments and waivers. Changes must be in writing and signed by both parties. A failure or delay in enforcing any term is not a waiver of it.
(d) Severability. If any provision is found unenforceable, it will be limited to the minimum extent necessary and the rest of this agreement will remain in effect.
(e) Assignment. Neither party may assign this agreement without the other party's written consent, except to a successor in a merger or sale of substantially all of its business, on notice.
(f) Relationship. Nothing in this agreement creates a partnership, joint venture or agency relationship unless expressly stated.
(g) Counterparts and electronic signatures. This agreement may be signed in counterparts and by electronic signature, each of which is an original and together form one agreement.
(h) Independent advice. Each party has had the opportunity to review this agreement with its own legal counsel and signs it voluntarily.

LANDLORD: _____________________  Name/Title: ______________  Date: __________
TENANT: _______________________  Name/Title: ______________  Date: __________

EXHIBITS: A Premises plan | B Landlord's Work | C Limited Guarantee (if any)

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This free template is provided by ClauseAudit for general informational purposes and is not legal advice. Have it reviewed before use. Replace all [BRACKETED] placeholders.