A missed renewal deadline can cost your business its location, even after ten years of paying rent on time. If you miss the notice window, you may lose the right to renew on the terms you negotiated. The landlord may then offer different terms or lease the space to someone else.
Other clauses can affect what you pay, who covers major repairs, and whether you can transfer the lease when you sell. Before you sign or renew, a Florida commercial real estate lawyer can help you identify which terms to question and what changes to request.
Personal Guarantees in a Commercial Lease
An LLC or corporation can help separate business obligations from personal assets. If you sign a personal guarantee, the landlord may hold you personally responsible for the obligations it covers.
Depending on its terms, a guarantee may cover:
- Past-due rent and rent for the remaining lease term.
- Repair costs and damage to the space.
- The landlord’s attorney fees and collection costs.
- Obligations that arise during a renewal or extension.
A guarantee can also survive the sale of your business. Suppose the buyer takes over the lease and later stops paying rent. The landlord may still be able to enforce your guarantee. Before closing the sale, check whether the landlord’s consent to the assignment includes a written release from the guarantee.
Ways to Limit a Personal Guarantee
If the landlord asks for a guarantee, negotiate how much it covers and when it ends. Options to discuss include:
- A dollar cap tied to a set amount, such as six or twelve months of rent.
- An expiration date that applies after a specified period of on-time payments.
- A surrender provision that limits future liability if you give the required notice and meet the conditions for returning the space.
- A written release when you sell the business or assign the lease.
Review the guarantee alongside your asset protection plan. Before signing, ask which obligations can follow you personally and what it takes to end them.
CAM Charges and Hidden Costs in Commercial Leases
Base rent tells you only part of what the space costs. Common area maintenance (CAM) charges can cover shared expenses such as landscaping, parking lot upkeep, and security. Depending on the lease, you may also pay a share of property taxes and insurance through CAM or separate operating expense charges.
Ask how the landlord calculates your share and what happens when actual expenses differ from the estimates. If your lease passes through storm deductibles, check how those costs are allocated and who handles hurricane insurance claims involving the property.
CAM Provisions to Question
- Uncapped increases. Ask whether you can cap annual increases in expenses the landlord controls.
- Major replacements. Check whether the landlord can pass through the cost of a new roof and charge it in one year.
- Insurance deductibles. Find out whether you share the deductible after a hurricane and how the landlord calculates your share.
- Management fees. Check which expenses the landlord uses to calculate the fee and whether other charges cover the same work.
- Limited access to records. Ask for the right to review supporting records and enough time to dispute charges after reconciliation.
If your 2025 reconciliation spans October 1, check which rental periods the charges cover. Florida repealed its sales tax on commercial rentals effective October 1, 2025. The prior tax can still apply to taxable charges for earlier rental periods, even when you pay them later.
Exclusivity Clauses in a Commercial Lease
If you lease space for a coffee shop, would your agreement let the landlord rent the unit next door to another café? An exclusivity clause can restrict the landlord from leasing covered spaces to tenants whose business falls within a defined category.
Define what the clause protects. A restriction on coffee shops may leave room for a bakery that also sells espresso. Check which units the clause covers and whether existing tenants can expand into the protected use.
Ask what happens if the landlord violates the clause. Depending on what you negotiate, the lease could give you a rent reduction or a right to terminate. If a dispute arises over whether another tenant’s use falls within the clause, the lease may provide for mediation or arbitration.
Commercial Lease Assignment and Subletting Limits
If you sell your business or downsize, you may need to assign the lease or sublet part of the space. Check whether the lease requires the landlord’s consent. If the buyer needs your location to operate, a delay or refusal can put the sale at risk.
Look for language saying the landlord cannot unreasonably withhold, condition, or delay consent. Also check what information the landlord can request and whether the lease sets a deadline to respond. If you plan to sublet, find out whether the landlord can take back the space or claim part of the sublease proceeds.
Change of Control Clauses
Some leases treat a change in company ownership as an assignment, even when the same company remains the tenant. Selling a controlling interest in an LLC or corporation can trigger a consent requirement, depending on the lease terms.
If you are preparing to sell, a business lawyer can review the lease early enough to address any consent requirement in the purchase agreement.
What “As-Is” Means in a Commercial Lease
An “as-is” clause generally means you accept the space in its current condition. Read it alongside the repair and maintenance provisions to see who pays when a major system fails. For example, the lease may assign routine HVAC maintenance to you and leave replacement costs unclear.
Before you accept the space:
- Have a qualified inspector check the HVAC, roof, plumbing, and electrical systems.
- Ask the landlord to confirm that major systems will work when you take possession.
- Check whether the space meets building code and accessibility requirements for your intended use.
- Put any promised repairs and responsibility for future replacements in writing.
Why Withholding Rent Is Risky in Florida
If a repair dispute leads to a commercial eviction case, Florida’s court registry rule generally requires the tenant to deposit rent with the court. If you dispute the amount due, you can ask the court to determine how much you must deposit.
Missing a required deposit can waive your defenses and allow the landlord to obtain a judgment for possession. If you receive eviction papers, get legal advice promptly about the deposit and any applicable deadlines.
What to Check in Your Lease Renewal Option
A renewal option can help you stay in a location your customers already know. To exercise it, you need to follow the notice requirements and meet any other conditions in the lease.
Review these terms before the notice window opens:
- Notice window. Check the earliest and latest dates you can exercise the option.
- Delivery requirements. Confirm how to send notice, who receives it, and whether delivery must occur by the deadline.
- Renewal rent. Check for scheduled increases or a market-rent formula. If rent depends on market value, ask how the parties resolve a disagreement.
- Eligibility. Identify any defaults or other conditions that could prevent you from renewing.
If you may need to move before the lease expires, review whether the agreement allows you to terminate the lease early and what that would cost.
How a Commercial Lease Attorney Can Help Before You Sign
The basics of a commercial lease include rent, term, and permitted use. When reviewing a draft, also consider what happens if your costs rise, a major system fails, or you need to sell the business.
If a disagreement is already underway, a contract dispute lawyer can review the lease and related notices. The available options depend on the terms and the type of commercial real estate dispute.
Before signing or renewing, bring the proposed lease, any amendments, and your deadline to a Florida commercial real estate lawyer at Lulich & Attorneys. We can help you identify the terms that affect your plans and propose changes before you commit.
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