Whenever you hire a space for commercial purposes, you have to sign a written agreement, which is known as a commercial lease. It is an agreement that is signed between the landlord and the tenant and contains all the conditions that have been mutually agreed between the two like the rent, the tenure for which you can occupy the space etc.
If you have rented the space through a service provider like Forum Properties, they will make sure that you understand what all is written in it. You should know some basics as you would be entering a legal contract by signing a lease. Here are some of the commercial leases that are used for renting business space in Canada.
This is the most basic type of lease and by paying a flat monthly amount as agreed upon the tenant is free of all responsibilities. It is the responsibility of the landlord to pay for all expenses related to operating the building, taxes, repairs and insurance.
In this type of lease, though the building operating costs come in the domain of the landlord, the tenant is responsible for some or all of the real estate taxes. In fact, one of the incidental expenses, which can be either property taxes or insurance or utilities, falls under the responsibility of the tenant.
Net-Net or Double Net Lease
This is a type of commercial real estate lease in which the tenant is accountable for two incidental expenses along with the base rent. So, while the landlords take care of all other expenses, any two like the insurance and property tax needs to be paid by the tenant.
Triple Net Lease
In these leases, the landlord takes no responsibility other than those of structural repairs. The tenant is accountable for all operating and maintenance costs, building insurance, property taxes, utilities etc.
These are few of the common leases that are prevalent, though there are many others too. Any commercial lease generally lasts from 3 to 10 years. The rent in commercial space is calculated by cost per square foot of the rented space. Depending on what type of lease you have signed, you will get the complete amount that you need to pay. It’s only in the gross lease that you end up paying a flat monthly amount.