What's the difference between a gross lease and a triple-net (NNN) lease?

In a gross lease, the tenant pays one fixed amount and the landlord covers operating expenses (taxes, insurance, maintenance). In an NNN lease, the tenant pays base rent plus a proportionate share of taxes, insurance, and CAM. NNN is dominant in retail and many office buildings; gross leases are more common in smaller multi-tenant offices. The accounting and risk allocation are very different.

Can a commercial lease be broken early?

Generally not without major consequences. Commercial tenants have far weaker break rights than residential ones — you're typically liable for all remaining rent unless the lease has an early-termination clause. Some leases include kick-out rights tied to revenue thresholds, but these are negotiated. If you anticipate needing flexibility, negotiate it into the lease before signing.

What is a tenant improvement (TI) allowance?

A TI allowance is money the landlord contributes toward customizing the space — often $20–$80 per square foot depending on market and lease term. The lease should define what the TI covers, who manages the build-out, and what happens if costs exceed the allowance. TI is amortized into the rent, so it's not really "free."

Do I need a guarantor on a commercial lease?

If you're a new business or LLC without a long financial history, landlords typically require a personal guarantee from the principals. Some leases include a "good guy guarantee" — a limited personal guarantee that ends when the tenant returns the keys. If full personal liability is too much, push for a good guy guarantee.

What happens if I want to leave but my lease isn't up?

Your options: assign the lease to a buyer or successor (with landlord consent), sublet the space (with consent), pay a negotiated termination fee, or stay liable for rent until lease end. Most commercial leases give the landlord broad discretion to refuse assignment — negotiate "consent not unreasonably withheld" upfront.

Can I negotiate a commercial lease, or are they take-it-or-leave-it?

Always negotiate. Commercial leases are between two businesses and are heavily negotiated in practice. Common asks: free rent (1–6 months), TI allowance, renewal options, assignment flexibility, exclusive-use rights, and personal-guarantee limitations. The first draft from a landlord's lawyer is rarely the final terms.

Commercial Lease Agreement

Commercial Lease Agreement — Built for Real Tenancies

Office, retail, warehouse, or industrial — generate a commercial lease that handles CAM charges, build-outs, assignment, and renewal options. Tailored to your state.

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Commercial Lease by state

State-specific clauses for all 50 US states. Tap your state below to draft a commercial lease that complies with local law.

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What is a Commercial Lease Agreement?

A commercial lease agreement is a contract between a landlord and a business tenant for non-residential space — office, retail, warehouse, industrial, or mixed-use. Commercial leases are dramatically different from residential ones: tenant protections are far weaker, rents are typically calculated with multiple components (base rent, CAM, taxes, insurance), and terms run for years rather than months.

Common structures include gross leases (landlord covers most expenses), net leases (tenant pays property taxes), and triple net (NNN) leases (tenant covers taxes, insurance, and maintenance). Each has very different implications for who absorbs cost increases over time. Build-outs, signage rights, exclusive use clauses, and assignment terms make every commercial lease unique.

Contract.DIY generates commercial leases that match the lease type you need, comply with your jurisdiction's commercial real estate rules, and include the operational clauses tenants and landlords actually fight over — assignment, subletting, holdover, restoration, and renewal options.

Key clauses included

Base rent and rent escalation

Starting rent and how it increases over the term

Lease type and additional rent

Gross, modified gross, or NNN — and what tenant pays beyond base rent

Term and renewal options

Initial term, extension rights, and notice requirements

Use and exclusive rights

Permitted use of the space and any exclusive-use provisions

Tenant improvements and build-out

Allowance, scope of work, and approval rights

Assignment and subletting

When the tenant can transfer the lease and consent requirements

Insurance and indemnification

Required coverage limits and mutual indemnity provisions

Default and remedies

Cure periods, acceleration of rent, and landlord remedies

Holdover and surrender

Conditions for staying past the term and restoration on exit

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