The lease agreement for commercial real estate, its correct execution, and minimizing risks for the enterprise is an issue that is always relevant for various segments of modern business. In fact, the conclusion of such agreements is an important tool that allows the enterprise to rent the necessary premises for conducting activities. Such premises can be included in various categories of the commercial segment: office, warehouse, or retail space, etc.
Today, despite all the difficulties and challenges of a full-scale war, the commercial real estate market provides many options for entrepreneurs in various regions of the state. Both a new enterprise and existing companies in the process of expansion or relocation may need to rent commercial facilities. Like any part of business activity, the procedure for renting non-residential premises requires a careful approach and compliance with all the rules of concluding a contract, in order to avoid possible losses and other problems.
In times of crisis, this topic becomes more relevant. During the military operations in Ukraine, the risks for representatives of various business segments increased significantly, some companies were attacked, or lost the opportunity to work due to the occupation of certain regions, were forced to relocate production facilities, or even the central offices of enterprises. At the same time, due to the growing demand for rent in safer regions, the number of scams in the commercial real estate market is also increasing.
It is worth noting that due to a combination of economic factors, modern companies may be limited in funds, therefore the issue of minimizing possible losses, including when renting premises, is becoming more and more relevant.
Profile experts recommend paying attention to many aspects during the procedure of renting real estate in the commercial sector. Let's consider the issue in more detail.
Lease of commercial property: basic nuances when concluding a lease agreement
There are several basic nuances to pay attention to when renting real estate for business, and tips for concluding a suitable contract.
First of all, it is necessary to clearly define the type of premises that must be rented for the enterprise, outline its purpose and relevant parameters. In the future, a search is conducted according to the specified features. At the same time, you can find and choose premises yourself, using modern services, or contact a professional agency specializing in commercial premises, which will also reduce the risks of encountering an unscrupulous landlord.
In addition, it is necessary to determine the terms of the lease in advance, which are subsequently specified in the relevant contract. There are offers on the market for both long-term leases and the possibility of short-term agreements.
Payment terms must be specified in the contract. In most cases, payment is made monthly, but there are different variations of cooperation. An equally important point is the conditions of use of the chosen premises - whether certain changes can be made at the facility, what types of activities can be carried out, technical features, the possibility of installing this or that equipment and other nuances.
It is also worth paying attention to who is responsible for the repair and maintenance of the premises, which should be specified in the contract. In most cases, tenants are responsible for minor repairs to the premises, while major repairs are the responsibility of the property owners.
The contract may specify the conditions for the purchase of the target premises, if the tenant has plans to purchase the object in the future.
The tenant must check the availability of ownership documentation and its correctness. The package of documents must be carefully checked before signing the lease agreement.
In some cases, it is advisable to contact a professional lawyer, who will help avoid most of the risks for the tenant, carefully check the documents, and correctly draw up an agreement on the lease of the target premises. In addition, it is recommended to personally discuss all the details with the owner of the commercial premises to avoid possible misunderstandings in the future.
The tenant and the landlord must keep a copy of the contract after signing.
Commercial real estate: regulations governing leases
When drawing up contracts for the lease of commercial real estate objects, it is necessary to be guided by the relevant provisions of the Economic Code of Ukraine aimed at regulating relations in the lease of the economic sphere.
Thus, part one, article 284 of the Economic Code of Ukraine outlines the following terms of the lease agreement, which are of significant importance:
- features of the lease object — composition and value of real estate, taking into account indexation;
- term of conclusion of the contract;
- rent, taking into account indexation;
- established procedure regarding the use of amortization-type deductions;
- restoration of leased property, established conditions for its return or subsequent redemption.
In fact, during the conclusion of the relevant contracts, business entities must necessarily agree on at least the above conditions, because otherwise such a contract is considered not concluded.
Also, it should be noted that according to Part 7 of Article 2 of the Law of Ukraine "On Leasing of State and Communal Property" it is established that the lease of property belonging to other forms of ownership may also be regulated by the provisions of the above-mentioned Law, in cases where the law or contract does not provide otherwise rent Thus, in order to avoid conflict and problematic situations during the conclusion, execution and termination of real estate lease agreements, it is advisable to specify in the agreement the condition of non-application of the provisions of the above-mentioned regulatory act to legal relations that are formed by concluding such an agreement, if the object lease is not an object belonging to communal or state property.
It is necessary to take into account some peculiarities and legal aspects when concluding an agreement on the lease of real estate:
- a lease agreement for a building or other types of capital structures for a period of up to three years is concluded in writing;
- if we are talking about a contract for a period of more than three years, it is also concluded in writing, while it is subject to notarization, except for cases when we are talking about state or communal property. In such a case, contracts concluded based on the results of an electronic auction for terms of more than 5 years are subject to notarization;
- the transfer of the facility to the tenant for use must be formalized by a relevant act, which must be signed by the parties to the contract, and it is from this moment that the period for calculating the rent begins, unless other conditions are established by the contract;
- in the absence of statements from one of the parties about changing the terms of the contract or terminating its validity, within a month after its expiration, it is considered extended on the previous terms.
Termination of such a contract cannot be carried out unilaterally, which is specified in Article 291 of the Economic Code of Ukraine. The contract may terminate in the following circumstances: expiration of its term, redemption of the object, liquidation of the business entity that is the lessee, or in case of destruction of the leased object.
In modern practice, there are quite often cases when landlords directly provide in the concluded agreement for the right to unilateral refusal without specific grounds, provided that the tenant is given a written warning within the specified time. However, this condition contradicts Article 291, part one of the Economic Code of Ukraine. Judicial practice also confirms the illegality of such conditions in contracts.
In practice, various cases of termination of such agreements are considered. The lease agreement can also be terminated by agreement of the parties, or at the request of one of the participants due to the grounds provided for by the Civil Code of Ukraine. Such grounds are regulated by Articles 783 and 784 of the Civil Code of Ukraine.