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Commercial Lease Checklist: Tenant Requirements

Tenant and Commercial Real Estate Resource

Review and negotiate commercial leases with our commercial lease checklist for tenants. For business tenants, tenant reps, and real estate advisors. Covers key lease terms: parties and premises, term and rent (base rent, CAM, escalations), permitted use, build-out and improvements, security deposit, insurance, maintenance and repairs, assignment and subletting, default and remedies, estoppel and SNDA, and personal guarantee. Use this checklist before signing so you understand tenant obligations, avoid surprises, and identify negotiable points. Not legal advice; consult an attorney for your lease.

Key Benefits

Identify key commercial lease terms before signing
Understand rent structure: base rent, CAM, and escalations
Clarify use, build-out, and maintenance responsibilities
Review insurance, assignment, and default provisions
Flag estoppel and SNDA obligations
Professional lease review workflow

Common Use Cases

Business tenants reviewing a first or renewal commercial leaseTenant reps and brokers advising clients on lease termsStartups and small businesses leasing office or retail spaceTenants negotiating build-out, CAM caps, or early terminationLegal and real estate teams preparing lease summariesTenants preparing for estoppel or SNDA requests

Frequently Asked Questions

What is a commercial lease?
A commercial lease is a contract between a landlord and a business tenant for the use of space (office, retail, industrial, etc.). Unlike residential leases, commercial leases are generally not subject to the same consumer protections; terms are heavily negotiated. Key areas include rent (often base rent plus CAM and other charges), term, use restrictions, build-out, maintenance, insurance, and assignment.
What are CAM charges and how do they work?
CAM (common area maintenance) charges are the tenant's share of costs to operate and maintain the property (e.g. landscaping, parking lot, common area utilities, property management). The lease defines how the tenant's share is calculated (often pro rata by square footage) and what is included. Tenants sometimes negotiate CAM caps or exclusions. Review the CAM language and budget carefully.
What should a tenant negotiate in a commercial lease?
Common negotiable points: length of term and renewal options; rent escalations (e.g. cap on annual increases); CAM caps or audit rights; build-out allowance and who pays for improvements; use clause and exclusivity; assignment and subletting rights; early termination or expansion options; maintenance and repair allocation; and personal guarantee limits. What is negotiable depends on market and leverage.
What is an SNDA?
An SNDA (subordination, non-disturbance, and attornment) agreement is often required when the landlord has a mortgage. Subordination means the lease is subordinate to the lender's lien; non-disturbance means if the lender forecloses, the lender will not disturb the tenant's possession as long as the tenant is not in default; attornment means the tenant will recognize the lender as landlord. Tenants should seek an SNDA to protect their occupancy.

Checklist

Basic Terms

Parties (landlord and tenant) and description of premises (suite, square footage)
Required

Correct legal names of landlord and tenant. Exact description of the leased space (address, suite, rentable vs usable square footage). Confirm square footage matches what you were shown; rent is often based on rentable area.

Term

Lease term: start date, end date, and any renewal options
Required

Commencement and expiration dates. Whether rent starts on possession or a later date. Renewal options: how many, notice period, and how rent is determined (e.g. fair market value, fixed % increase).

Rent

Base rent: amount, pay period, and escalation (e.g. annual % increase)
Required

Base rent per square foot or flat amount; monthly or other frequency. Escalation: fixed % each year, CPI, or step increases. Understand total rent over the term.

CAM (common area maintenance) and other additional rent (taxes, insurance, utilities)
Required

How CAM and tenant's share of taxes and insurance are calculated (e.g. pro rata). What is included in CAM; exclusions (e.g. capital costs). Estimate or cap if possible. Audit rights for CAM.

Use

Permitted use clause (allowed business use and exclusivity if any)
Required

Use must match your business. Restrictive use limits your ability to change or assign. Exclusivity (e.g. only coffee shop in center) protects you from direct competitors; confirm in writing.

Improvements

Build-out, tenant improvements (TI), and who pays
Required

What landlord will provide (allowance, turnkey build-out). Who designs and constructs; who pays over allowance. Condition of delivery (vanilla box, etc.). Approval process for changes.

Deposit

Security deposit: amount, form (cash, letter of credit), and return conditions
Required

Amount and when due. Cash vs letter of credit (LOC may be required for larger tenants). When and how it is returned; deductions. Interest if any.

Insurance

Tenant insurance requirements (liability, property, endorsements)
Required

Minimum limits (e.g. $1M liability); property insurance; naming landlord as additional insured. Proof of insurance before possession and annually. Subrogation waiver if negotiable.

Operations

Maintenance and repairs: tenant vs landlord responsibilities
Required

Who maintains HVAC, interior, exterior, common areas. Triple net (NNN) vs modified gross: tenant often pays more in NNN. Clarify structural vs tenant responsibility.

Transfer

Assignment and subletting: consent requirements and conditions
Required

Landlord consent required; whether consent may be withheld or must be reasonable. Recapture right (landlord can take space back). Sublet profits: who keeps. Important for flexibility if you sell or downsize.

Legal

Default and remedies: cure period, late fees, and landlord remedies
Required

What constitutes default (non-payment, breach). Cure period (e.g. 5–10 days for payment). Late fees and interest. Landlord's remedies: re-enter, terminate, pursue rent. Notice and opportunity to cure.

Estoppel certificate and SNDA (subordination, non-disturbance, attornment)
Required

Tenant may be required to sign estoppels (confirming lease terms) for lender or buyer. SNDA: request non-disturbance so if landlord is foreclosed, tenant's lease survives. Negotiate SNDA early.

Personal guarantee or other credit support (if applicable)

Landlord may require a personal guarantee from principal(s). Limit amount (e.g. 6–12 months rent), term (e.g. first 2 years only), or negotiate release after certain conditions. Entity-only obligation is preferable if possible.