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Brian Madigan LL.B., Broker

RE/MAX West Realty Inc.,
Independently owned and operated

96 Rexdale Blvd. 
Toronto, Ontario 

Phone: 416-745-2300

Cell: 647-404-8150 
Toll Free: 1-888-507-0817

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Drafting the Offer for a Commercial Lease (Part 2)

August 19, 2013 - Updated: August 19, 2013




Ultimately, it can be difficult to determine which ones require review and which ones don’t.


For the larger commercial transactions, with $100,000.00 per year in annual rents, the Landlord will usually provide a copy of the Lease ahead of time.


I think, the agent should review it and then recommend:


  1. the client should review it carefully, and
  2. the client should have their lawyer review it.


Then, any changes can be attached to the schedule. This avoids the two stage negotiation process.


On smaller transactions, the client may not wish to retain a lawyer at the Offer stage. And, landlords on smaller transactions don’t want to negotiate the finer points on the Lease, if the prospective tenant is not approved.


So, this means that effectively, you are facing a two stage negotiation process, once over the Offer, then over the standard Lease terms.


On the smaller transactions, send in the credit check right away. This is a good indication to the landlord that the prospective tenant is serious and would make a good tenant.


Then, send in the Offer with some “outs” that will permit negotiation over the landlord’s standard form. What you don’t want is a landlord who has an objectionable standard form to keep the first and last months rent.


At the second stage, I think that it is wise to recommend that a lawyer review it. If the client declines, then so be it. But, at least you now have a record of having made this recommendation.


If there is no legal review, and the client is unsophisticated, you had better be sure that there are no problems with the Lease. This would be a good time to have someone who knows leasing to have a look at the document, otherwise, you are on the hook.


Brian Madigan LL.B., Broker


Tagged with: commercial lease offer draft large small lawyer review ontario law
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Brian Madigan LL.B. Broker

RE/MAX West Realty Inc. Brokerage

Independently owned and operated

96 Rexdale Blvd. , Toronto Ontario,

Phone: 416-745-2300

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