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Who pays for maintenance when you sign a commercial lease?

| Oct 1, 2021 | Real Estate |

When you sign a commercial lease, you lock yourself into a commitment to use a space for your business, often for several years. You will have to pay rent, maintain insurance coverage and meet other obligations from the lease, which may include both performing some maintenance and paying maintenance fees. 

Over the course of your lease, you will get to know the space better, including issues with some of its primary systems or with the structure itself. Some of those issues may be problems that you can ignore or live with, while others may be serious enough to warrant repairs. 

Before you send the notice to your landlord about the problem with the HVAC system, you may want to review your lease first. Commercial tenants sometimes have at least partial responsibility for facility maintenance.

Commercial leases impose differing responsibilities on landlords

Some commercial leases involve a landlord providing all of the maintenance and repairs for the building. This kind of arrangement is common with facilities that have multiple tenants in a single space or building. 

Often, such an arrangement will come with an obligation for tenants to pay common area maintenance (CAM) fees that cover all of the landlord’s costs incurred by maintaining the bathrooms and the parking lot, among other shared facilities. However, some commercial leases will charge tenant maintenance fees while still requiring them to cover maintenance within their specific unit. 

A careful review of your lease can help you determine if you will have to pay for those HVAC repairs or your landlord will. Understanding the terms of a commercial lease and negotiating before you sign one or renew one could help you protect your business