Common Commercial Lease Terms

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Lease disclosure help you avoid trap and negotiate for bargains in your advantage.

The commercial lease clauses are the written and binding agreement on the real estate you will rent for your business. It will help you avoid trap and negotiate for bargains in your advantage.


This is also called the “landlord and tenant” lease. This is the portion of the clause where the landlord and the tenant are named. You must make sure that the names written in this portion are correct, especially if you’re a corporation or an LLC. Otherwise, you will be personally liable for the lease.

Premises Clause

This usually comes next to the “parties” clause. It gives a detailed description of how big is the space you are renting.

Use Clause

This provides the limitation on how you can use the space and what product or services you are allowed to offer.

Exclusive Clause

This clause is the landlord’s promise that you will be the only one to conduct that type of business in the building.

Term Clause

This specifies the length of your lease from the starting date up to when it will end. Read this part properly so that you won’t be paying for the date when you haven’t used the property yet.


This clause shows how much rent you have to pay, the mode of payment, and when should you pay it. You must study this properly to balance your finances.

Security Deposits

You Landlord will ask for this to guarantee that there will still be money if you fail to pay.

Improvements and Altercations

If you want changes done to the property, you must get an agreement with the landlord on who will design, work on it, and pay for it.


This is an agreement that includes your maintenance duties to the building if you are the sole owner and the utilities if you are renting in a multi-tenant building.

Parking, Security, and signs

This is an important part of the clause because it can provide convenience to your tenancy.

Insurance Clauses

This includes property insurance, liability insurance, leasehold insurance, and rental interruption insurance.

To thoroughly understand these clauses and not miss any hidden traps, it is best that you consult or hire a lawyer.

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