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Elements to include in your Texas commercial lease

Like other Texas business owners, you may need to rent a commercial space to run your business out of. When you find a building or space that fits your needs, you will likely sign a lease agreement with a landlord. Here at The Jackson Law Firm, we know that the elements you include in your such an agreement may help you avoid disputes down the line.

Most commercial lease agreements will include a parties clause, which specifies the names of the landlord and the tenant. It may seem like you are stating the obvious, but it is important to ensure all of the information in this portion of the agreement is correct. In order to avoid being held personally responsible for the building under the lease, it is advisable that you use your business’ full legal name, rather than your personal name.

The premises clause, which refers to the specific property or space you will be occupying is also a common element of commercial lease agreements. If you are leasing an entire building, then a street address is typically sufficient for this clause. If you are leasing a space within a building, however, you will want to ensure that the agreement specifies all of the areas that you have access to. This includes elevators, storage rooms and parking. Having this information in a legal contract may be helpful if a dispute arises over the space you are using with the landlord or with another tenant.

Term clauses are also included in most commercial leases. These will specify the start and end date of your lease. Entrepreneur magazine recommends that you ensure your commercial lease agreement includes a bail-out clause. This may be especially helpful if you are renting a retail space. A bail-out clause may let you break your lease in the event your sales do not reach a pre-specified amount.

In order to make your space work for your needs, you may need to make changes. Thus, you should ensure that your lease agreement includes an improvements and alterations clause. Such clauses will address such improvements, who will perform the work and who will pay for the alterations. They will also include your and your landlord’s approval. This may help you avoid being held financially responsible for restoring the space after your lease is up.

For more information about commercial leases, please visit our real estate litigation page.

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