Commercial lease agreements would take one of the top places in terms of complexity among all the possible documents and agreements you may ever need to sign. MB Property Law experts know how challenging it can be to read, and most importantly — understand all the terms you’re supposed to agree with. Here is why hiring a real estate lawyer to review your lease agreement might be a wise decision.
What is Commercial Lease?
Basics first. In Canada, people, in general, are more familiar with residential lease agreements, so we’ll take it as an example. A residential lease is an agreement between a landlord and a tenant to determine the conditions for dwelling in an apartment over a certain period of time. It’s usually signed by the parties in order to avoid any future misunderstandings. In other words, it is done to prevent any court disputes about what such an agreement means.
A commercial lease is different. That’s a different type of contract with different goals and aims. it would be a great mistake to take your commercial lease as lightly as a residential lease. A commercial lease in Canada is a document that defines the conditions under which a tenant or a business entity can occupy a space on the property that belongs to another person or entity on a long-term basis.
Most commercial leases are long-term agreements. Typically, they are signed for five years, and after that period ends, you have an opportunity to renew them as many times as you want.
It is important to note that you cannot modify this agreement on your own. Before you sign any document involving one or more business entities, be sure you consider all possible outcomes.
What is a Lease Review?
If you head to the Amazon rainforest with an expedition — you need a local guide that knows all the trails. If you want to travel by car to a new country — you need a good navigator app.
It’s natural to seek assistance in situations when you’re obviously not the expert. And signing your commercial lease agreement is not an exception. That’s exactly why MB Law experts can help you.
If you want to avoid unnecessary penalties or complications, professional lease review is not a step you should forget. The best way to learn how to navigate the process on your own is by getting some help from a reputable lawyer.
A professional will help you evaluate whether your offer meets the landlord’s expectations and vice versa. Also, they will be able to identify the most important terms of the agreement that might be favorable for you, and those that can cost you unnecessary extra expenses in the long run.
In simple terms, a lease review is not a legal process or a procedure — it’s a consultation. You give a complicated document to a professional that studies it thoroughly, understands every word and condition (most importantly — with their practical consequences), and tells you, in simple terms, with your business’s best interests in mind, whether the agreement is beneficial for you, or not.
A professional lawyer will highlight the conditions that may damage your business interests in the future or cost extra money, so you take the decision, whether you’re ready to sign it or you need to negotiate changes.
An even shorter way to put it — a lease review is your chance to agree to a lease with a full understanding of it and its consequences, practical implications, and improvements in your favor. Remember, you can not change the terms after you sign it, so you have to be 100% sure you know exactly what you sign.
Why Hire a Lawyer for Your Lease Review?
On top of all of the above, a real estate lawyer (especially the one with sufficient expertise) like an MB Law expert, will look at the agreement and suggest new areas for research that you should be aware of.
For example, if you have net rent plus operating costs — you have no clear sum in the agreement It can be both adequate and immense, sometimes — to the point that the whole commercial lease agreement loses its sense to your business. A good real estate lawyer will highlight it for you and turn the vague wording into a simple task: do research on the operating costs of the property and add approximate sums to the calculations.
It’s one of the most simple examples, but every page of your commercial lease may have dozens of areas that require extra attention, extra research, or might be changed easily in your favor. Noticing them all by yourself is challenging if you don’t have decades of experience in reading and rewriting lengthy lease agreements. That’s exactly why hiring a lawyer to review your commercial lease is an investment in your business’s future financial health.