Considerations Before Signing A Commercial Lease

The commercial property market is a busy and rising market. It is becoming harder and harder to gain favourable terms on the commercial property of your dreams. It is extremely tempting to quickly complete a commercial lease without getting legal advice, for fear of missing out. However, this is not recommended. There are important considerations that you need to be aware of before signing a commercial lease. This is what we look at in this blog post.

One of the considerations you need to be aware of before signing a commercial lease is the name the lease is being taking out in. If the lease is taken in the name of the company, are additional security measures required by the landlord? Is a personal guarantee required from a director too? Are the directors aware of what this means to them, personally?

Are there any repairing obligations on the lease? Is the lease on a fully insuring and repairing basis? If so, do you know what this means in practice for your business and the commercial premises? Is there a schedule of condition in place?

Do you have the ability to break to commercial lease early? Is there a change for breaking the lease before the end of the term? Will you be able to recover any overpayments in rent if the commercial lease is broken early?

Have you looked at the Stamp Duty Land Tax that is payable on completion of the lease? Will you be able to comply with the 30-day filing requirement? If not, you could end up with a fire from the HMRC. Is the lease compulsorily registerable at the Land Registry? If so, you would need to see if the plans attached are lease Land Registry compliant.

These are just some of the considerations you need to be aware of before signing a commercial lease. This is why it is highly recommended that you gain expert legal advice from our commercial property solicitors. We can manage these considerations for you to ensure that you, your business and your commercial premises are protected.

Our commercial property lawyers are often contacted to advice on matters where tenants have entered leases without fully understanding the terms and implications. At this point it is much harder, and more costly to get out of these leases. Make sure you speak to our commercial property lease experts before signing a commercial lease, so these considerations are not missed.