6 clauses to read twice before you sign a commercial lease

The rent number gets all the attention. The clauses below decide what the space actually costs you over five years — and how painful it is to leave, grow, or shrink inside it.

1. Renewal options

A renewal right without a pre-agreed mechanism is a hope, not a right. Push for fair-market language with a baseball-arbitration backstop, and make sure the notice window is one you can actually hit — nine to twelve months, not eighteen.

2. Escalations

Fixed 3% annual bumps compound brutally; CPI-linked increases can surprise worse. Model both over the full term including options, and cap any pass-through that isn't in your control.

3. Tenant improvement allowance

Negotiate TI as amortized dollars per square foot with a disbursement schedule — not a vague "landlord's work" letter. Unused allowance should convert to rent credit, not evaporate.

4. Assignment and sublease

Your exit is your leverage. Reject blanket landlord consent; require "not unreasonably withheld" as a minimum, keep 50%+ of any sublease profit, and carve out affiliate transfers entirely.

5. Operating expenses

Insist on a gross-up clause, a cap on controllable expenses, and audit rights with teeth. Base-year games add 5–8% to occupancy cost in year three — every time.

6. Restoration and surrender

"Return to base building condition" can mean a six-figure demolition bill. Define the surrender standard precisely, pre-agree what stays, and get wear-and-tear excluded in writing.