A business that leases real estate and improvements (buildings, etc.) in the form of space for offices, a warehouse, a restaurant, a nail or hair salon, a clothing store, a coffee shop, or other commercial (nonresidential) space will usually be required to sign a written contract known as a commercial lease agreement.
The tenant (the business occupying the space) who signs a commercial lease agreement is generally expected to be a more savvy, sophisticated, and informed tenant (also known as a lessee) than a tenant in a residential lease, and the law usually does not provide a commercial tenant with the same protections as residential tenant receives.
Because the law does not provide a commercial tenant with many protections, it is up to the commercial tenant to read, understand, and negotiate protections in a proposed lease agreement before signing it, as most every paragraph in a commercial lease agreement can have a significant impact on a business’s operations and financial stability.
As with most other questions, a commercial tenant's ability to break or terminate a lease before the end of the lease term depends primarily on the terms of the written lease agreement.
In Texas, businesses seeking to lease commercial spaces such as offices, warehouses, or retail locations enter into commercial lease agreements. Unlike residential tenants, commercial tenants are considered more knowledgeable and are expected to negotiate the terms of their leases. Texas law does not provide the same level of protection to commercial tenants as it does to residential tenants. Therefore, it is crucial for a business to thoroughly review, understand, and negotiate the terms of a commercial lease agreement before signing. The ability to terminate a commercial lease early is largely dependent on the specific provisions outlined in the lease agreement itself. An attorney can be instrumental in reviewing and negotiating a commercial lease to ensure that the business's interests are adequately protected.
