What to Expect When Changing Use of a Leased Commercial Space

What to Expect When Changing Use of a Leased Commercial Space

When you sign an Arizona commercial lease, there will be several provisions in your contract. Terms such as the names of the parties, the amount of rent, the length of the rental, and how the tenant may use the premises are usually present. After operating your business for a while, you may decide that you want to use the property in a way that is not indicated in your lease. Here is what to expect when changing the use of a leased commercial space:

Look at Your Lease Terms

The first place to look is at the lease itself. For instance, if you rented a building to operate a fitness facility, your lease is likely to have language that states something along those lines. However, you and your attorney may have anticipated that would want to offer other goods and services in the future. In this situation, there may be a term that allows you to also run a shop that sells fitness clothing and accessories within the business. You may also have clauses that enable you to prepare and sell health foods to clients or offer massage therapy services. If the use was contemplated by the parties and included in the lease, there may not be an issue.

You May Need to Renegotiate

If your lease does not allow you to change or add a use to the premises, it is not advisable to start doing so without consulting a real estate attorney. In this situation you may need to renegotiate your lease or enter into an agreement with your landlord. If you start using the property in a way that is not permitted under the lease, you could violate your agreement. Your violation would make it possible for your landlord to evict you for breach of contract or potentially seek other damages.

Don’t Make Major Changes to the Property

If you want to make a reasonable and foreseeable use of the property, the landlord is probably not going to have a problem with you adding something new. However, commercial leases often have very specific language restricting how a tenant may physically alter a property. If your new use requires significant structural or cosmetic alterations that were not originally agreed upon, your landlord may not be willing to do so outside of entering into a new lease.

Laura B. Bramnick is an experienced Arizona real estate attorney who has the expertise to help you navigate changes to your commercial lease agreement.

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