A lease agreement is a legal contract that outlines the rental terms for a residential or commercial property. The property owner, also known as the landlord, and the renter, also known as the tenant, sign the lease agreement. When the landlord and tenant cannot resolve the dispute, litigation may become necessary, and the lease agreement will govern the outcome of the dispute.
Contact a Pittsburgh Lease Agreement Attorney
Creating an effective and thorough release agreement is crucial because it will protect all parties involved throughout the length of the lease. Whether you are a landlord or tenant involved in a lease agreement dispute, Jones Gregg Creehan & Gerace can help. Contact our business contract attorney today to schedule your initial consultation. One of our skilled attorneys will carefully review your case and advise you of your best legal options. Contact us today to schedule your free initial consultation.
Understanding Commercial Lease Agreements in Pennsylvania
Many landlords rely on a boilerplate lease agreement to save money. However, working with a business law attorney to create a lease agreement tailored to your interest can help you should any legal issues arise. As you will see, the terms of the lease agreement will determine the rights and responsibilities of the landlord and tenant. Most lease agreements are long-term property contracts that last over 30 days.
Some lease agreements are rent-to-own lease agreements, also called lease-to-own agreements. These agreements give the tenant the option to purchase the property at a predetermined price after paying an option fee to the landlord. If the renter decides not to purchase the property, the landlord will keep the option fees. Pennsylvania has its laws and regulations regarding lease agreements and rental properties. These laws regulate the following matters:
- General landlord and tenant rights
- Security deposits
- Late rent payments
- Lease agreement violations
- Landlord’s access to the rental property after the tenant takes up residence
Types of Commercial Leases
Residential leases refer to a rental agreement between a landlord and an individual for a property in which the individual will live. Commercial leases govern the leases made for business purposes. Retail locations, warehouses, and other types of businesses can lease their property from a landlord. At Jones Gregg Creehan & Gerace, our real estate attorneys have successfully advocated for clients in residential and commercial lease matters. We’ve represented clients with multiple different types of commercial lease agreements, such as:
- Net lease: The tenant pays rent, some or all of the taxes, maintenance, and insurance for the property.
- Gross lease: The landlord charges higher rent, but includes costs such as insurance, taxes, and maintenance. Gross leases are common for office space and retail locations.
- Triple net lease: This type of lease is preferred by commercial landlords because it requires the tenant to pay for taxes, rent, insurance, and maintenance.
- Percentage lease: This lease requires a base rent payment along with a percentage of the monthly sales and is usually used for retail leases.
Important Lease Agreement Clauses
The landlord and tenant have a right to negotiate the terms in their lease agreement. In commercial leases, the tenant often pays the upkeep and utilities, saving the landlord time and money. If you were considering signing a commercial lease as a business owner, it’s wise to discuss the lease terms with an attorney to make sure they are fair for you and your business. Entering into a long-term commercial lease agreement with a high-risk business can jeopardize your business and future. An attorney can help you protect yourself and your assets.
At Jones Gregg Creehan & Gerace, one of our experienced real estate attorneys can review your agreement carefully. If you haven’t drafted your lease agreement yet, we will help you draft a thorough and protective lease agreement. Our attorneys can identify all of the common red flags in lease agreements. We can also make sure that all of the important clauses are included in your lease agreement so you can protect yourself.
The Use Clause
The use clause dictates the purposes for which a property can be used. A commercial lease agreement may state that the property can only be used for restaurant, retail, or warehousing purposes. The landlord may find it easier to lease a similar space to a similar business by limiting the commercial property’s use. If you are a tenant, you want to ensure that you will be able to use the property for all of the services you offer your customer.
The Exclusivity Clause
The tenant in a commercial lease may request an exclusivity clause. The tenant may be concerned that the landlord will lease a nearby property to another business similar to their own and compete with them. For example, a bakery may be concerned that the landlord will lease another property to another bakery nearby, cutting into their customer base. An exclusivity clause would prohibit the landlord from leasing the property to another similar business.
Subletting and Assigning
Subletting a property can be beneficial for the landlord and tenant. When the original tenant can’t afford the rent or goes out of business, the landlord can receive rent from a subletter. The lease agreement should outline the terms for subletting to protect the interests of the landlord and the tenant. If you are a tenant, it’s important that you understand whether you will be allowed to sublet the property if necessary.
Discuss Your Case With a Pittsburgh Lease Agreement Attorney
Lease agreements are legally binding contracts. The language and terms set forth in the lease agreement needs to be clear and comprehensive. Whether you need legal assistance to draft a commercial lease or you are involved in a lease agreement dispute, you need a skilled attorney on your side. The real estate attorneys at Jones Gregg Creehan & Gerace have extensive experience representing clients in a wide range of lease-related matters. Contact us today for a consultation today.