Key Differences Between Residential and Commercial Leases

The modern office might not look like it has in the past. More people are looking for virtual or “hybrid” work, but the physical office will never be replaced in some industries. Whether someone works in one of those industries or simply wants to keep the traditional office setting alive, finding the perfect location to do so can be a fulfilling task. After all, this provides the opportunity to mold the setting where the company will get its most important work done.

These changes impact Florida landlords who will need to navigate the specifics of a commercial lease. These have different guidelines and expectations compared to residential leases. We want to walk through some of these differences to ensure you have an executable and thorough lease whether you’re writing a commercial or residential lease.

Expenses & Responsibilities

Under a typical residential lease, tenants are asked to pay the rent and then some utilities. Some residential buildings don’t require tenants to cover any utilities or just build those and other expected expenses into the rent. Florida law does not require renters insurance. From a maintenance perspective, you (as the landlord) will generally be responsible for any maintenance other than what’s directly caused by the tenant.

As a commercial tenant, the overall responsibility will include far more payments than just the rent. Generally, commercial tenants will be required to cover additional expenses including insurance (sometimes multiple forms of insurance), taxes, and maintenance. The landlord may cover some maintenance responsibilities depending on the lease agreement, but overall maintenance expectations fall into the tenant’s hands.

Legal Protections

Residents earned the right to be protected by and from predatory landlords when entering into an agreement to occupy a dwelling. Nobody should be unsafe in their home so tenants will be covered from incidents and accidents that arise from negligence or intentional malpractice by a landlord.

As mentioned above, many maintenance responsibilities will be covered by the tenant in a commercial lease. This also means much of those legal protections afforded to tenants of residential leases won’t extend to a commercial tenant who takes care of their own maintenance. You and your attorney should fully review the commercial lease to get a full understanding of what your legal protections and options are for future reference.

Lease Terms

A lease with a term of more than 12 months is rare when it comes to residential leases. These are often month-to-month, six months, 12 months, or, in rare cases, 24/36 months. Many renters are doing so until they can raise the funds to buy their own home and locking themselves into long-term leases makes no sense for them. The lease amount is also set for the duration of the agreement and will only increase or decrease at renewal unless there’s a special agreement otherwise.

For commercial leases, it’s very likely you will want to look at a length of 36 months or even up to five or ten years depending on the building, the size of the company, and the goals of the agreement. These longer lease terms can be beneficial to large companies that are hoping for stability without having to adjust lease payments to reflect a growing market. However, even a long-term lease can have built-in increases – locking companies in for the long run while still adjusting for appreciation of the property’s value. These are just a few of the basic aspects of commercial and residential leases that need to be considered by Florida landlords. If you’re not prepared and don’t review the terms in full with an attorney it could plant unnecessary risk on your shoulders. At The Law Offices of Ray Garcia, we can assist you with a thorough review of an upcoming or current lease and help you make the right choice for yourself and your business. Contact us today.

The following two tabs change content below.

Law Office of Ray Garcia, P.A.

Our mission is to provide our clients with legal services that not only meet their needs but exceed their expectations. We approach all practice areas with care, knowledge, experience, and determination. Trusted In South Florida For Decades.

Latest posts by Law Office of Ray Garcia, P.A. (see all)

Skip to content