Three Overlooked Terms to Watch for When Reviewing a Commercial Lease

When negotiating a commercial lease, most tenants focus on the basics: the length of the lease (term) and the monthly rent. But unlike residential leases, commercial leases are highly customizable—and nearly every provision is negotiable. That flexibility is a double-edged sword. Unless you read the fine print, you may find yourself locked into costly or restrictive terms that could have been avoided with a bit of upfront diligence.

Here are three key issues to watch for—beyond term and rent—when reviewing a commercial lease:

1. Responsibility for Equipment Repairs (Especially HVAC)

In many commercial leases, the tenant is responsible for maintaining and repairing equipment serving their premises—including HVAC systems. In Florida, where AC is non-negotiable, HVAC repairs or replacements can be a major and unexpected expense.

Before signing a lease, find out who is responsible for maintaining the HVAC. If it’s you, ask for the service history and age of the system. Better yet, consider hiring an independent inspector to assess its condition before you commit. If the unit is near the end of its useful life, you may be able to negotiate a replacement or cost-sharing arrangement as part of your lease.

2. Fees Beyond Rent: CAM, Management, and Administrative Fees

Commercial leases often require tenants to pay additional fees beyond base rent. These can include Common Area Maintenance (CAM) fees, property taxes, insurance, and more. Some leases also include management or administrative fees, which may be charged as a percentage of total expenses or as a flat monthly fee.

Ask how these fees are calculated and whether they’re affected by occupancy. If a major tenant leaves, will your share of CAM fees suddenly spike? Does the lease give you audit rights to review these expenses? Is there a cap on how much they can increase each year? These are all fair questions—and negotiating clarity and limits on these fees can make a big difference in your total monthly costs.

3. Exclusive or Restricted Use Clauses

Imagine opening your specialty coffee shop only to find out six months later that a national coffee chain is moving in next door. Unless your lease includes an exclusive use clause, this scenario is entirely possible.

An exclusive use clause restricts the landlord from leasing nearby space to a direct competitor. Similarly, a restricted use clause can prevent incompatible businesses from opening nearby (if you’re opening a quiet, relaxing day spa, you probably don’t want a gym next door blasting music ). These provisions aren’t automatic—you’ll need to ask for them and negotiate their scope—but they’re worth the effort to protect your customer base and brand.

Bottom Line:
A commercial lease is more than just a rent agreement—it’s a framework for your entire business operation. Taking the time to understand what’s in it (and what’s not) can save you headaches and money down the road. If you’re considering a lease for your business, working with an attorney who can flag red flags and help you negotiate favorable terms can be a smart investment.