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What are the different commercial real estate lease options?

Those in Florida who are considering leasing commercial property may feel overwhelmed with everything that is involved in taking such action. This is a big -- and rather expensive -- venture, so it is understandable for potential tenants to want to ensure that they are not taken advantage of during the process, and that lease terms best benefit their overall goals. What are some of the different commercial real estate lease options?

There are actually several different kinds of leases. A landlord will, obviously, choose the type that he or she feels best for his or her circumstances. However, nothing is set in stone, and numerous landlords may be willing to negotiate lease terms. A few lease types that are commonly seen include:

  • Fixed leases
  • Gross leases
  • Cost-of-living leases

Fixed leases are pretty self-explanatory. There are leases set for a specific period of time and a set rate. If a gross lease is signed, the landlord basically agrees to pay all operating costs, while the tenant pays a fixed rate every month; however, rent is subject to change based on operating expenses. Finally, in a cost-of-living lease, the rent amount is determined by just that -- the cost-of-living. Rent may be increased due to inflation.

Before signing any commercial real estate lease documents, in Florida or elsewhere, it is important to get a clear understanding of the lease terms and how they will affect one's business. Failing to do this may only cause problems in the future. An experienced business and real estate attorney will be able to help by reviewing all documents, assisting in negotiating better terms and ensuring all contracts represent the best interests of the client.

Source: FindLaw, "Types of Leases", Accessed on Sept. 23, 2015

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