Very few commercial tenants will start off their initial search for an office space lease already thinking about when and how they will renew the property once their lease term expires. However, this renewal option is extremely important as it safeguards the tenant, especially if they are comfortable in their office space and don’t want to have to move out once their lease term expires. As a commercial office tenant, you want to know about renewal options in the very beginning, even before you sign an initial lease. The following will highlight the important factors which one should know about the renewal option of a commercial office building lease.
What Does A Commercial Office Lease Renewal Option Do?
A renewal option in a commercial office lease is a clause which details whether the tenant is able to renew the current lease and what terms apply to such a renewal of the lease. The renewal clause will dictate when the renewal option must take place and what the tenant must do to put such a renewal of the lease in effect. In addition, the renewal option clause will list all of the other fine details to renewing one’s lease, all of which the tenant must follow in order to properly initiate the renewal option of the commercial office space lease.
When Do You Need To Start Negotiating The Terms Of The Renewal Option?
Although the renewal option will not be put into force until a certain time as stated in the initial lease, it is imperative that the office space tenant have such a clause put into the initial lease prior to signing it. This way there is no doubt as to the issues involving renewal of the initial lease and accompanying lease terms. When the lease is being drafted is when the tenant and landlord should discuss the terms involving lease renewal and renewal options.
What Should The Renewal Option Clause Include To Protect You As The Commercial Tenant?
In order to be properly protected as an office space tenant, the renewal option in the initial lease should include a few distinct features. This clause should state the time in which a tenant must give notice in order to properly renew their lease, the lease renewal length and the rate of the commercial rental. By having all of these factors in writing, the office space tenant can rest easy knowing that should they choose to do so, they will be able to renew their current commercial office space lease when the time comes.
The presence of the renewal option in a commercial office lease is extremely important. It protects the commercial office space client from having to move out when their lease term expires if they don’t want to and provides them with peace of mind knowing that they will be able to continue working in their current location for a specified period of time beyond the initial term of the lease. Therefore, having this renewal option and negotiating the terms of it prior to signing the primary lease is a must.