A California commercial lease agreement is a binding contract for a tenant to lease retail, office, or industrial space. The agreement sets the responsibilities and rights for both landlords and tenants, as well as details about rent, deadlines, penalties and other details.
The California law that governs commercial leases is California Commercial Code Division 10, Chapter 4. These types of leases are longer and more complicated than a residential lease, so consulting with a lawyer is advisable.
California Commercial Lease Requirements
The following are specific requirements for commercial leases in California:
- Asbestos Disclosure: The landlord of any property built prior to 1979 must disclose whether asbestos is known to be contained in the structure or on the premises. This notice must indicate the specific location of the asbestos on the property and the necessary procedures to follow to prevent exposure to the hazardous material.
- Disability Access Inspection Disclosure for Commercial Properties: The landlord of a commercial property must disclose whether the premises has undergone an accessibility inspection conducted by a Certified Access Specialist (CASp). These reports can also be requested by the tenant.
- Proposition 65 Warning Notice: Informs tenants regarding exposure to potentially harmful chemicals in the environment of the leased property, such as in the drinking water. This disclosure is always required when a commercial property employs over 10 people. If applicable, this statement must be visible to employees: “Attention: This premises contains chemicals proven to the state of California to increase the risk of cancer, birth defects or reproductive harm.”
Writing a California Commercial Lease Agreement
A California commercial lease agreement should generally contain the following:
- Landlord’s name and contact information
- Property manager’s name and contact information (if any)
- Tenant’s name and contact information
- Authorized use of the lease property
- Description of the lease property
- Type of lease (gross, modified-gross, or triple-net)
- Term of the lease and the commencement date
- Rent and landlord’s profit participation in operations (if any)
- Penalty for late/non-payment of rent (including eviction process)
- Designation of the responsible parties for certain expenses and utilities
- Security deposit and refund policy
- Permissible leasehold improvements allowed by the landlord
- Additional terms as needed (including municipal codes and restrictions)
- Landlord and tenant contact information and form for legal service
- Option to renew the lease (if any)
- Jurisdiction and reference to California state law
- Place for the notarized signatures of all parties
- Miscellaneous terms specific to the lease
Sources
- 1 HEALTH AND SAFETY CODE SECTION 25915-25919.7
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The existence of, conclusions from, and a description or list of the contents of, any survey known to the owner conducted to determine the existence and location of asbestos-containing construction materials within the building, and information describing when and where the results of the survey are available…
Source Link - 2 California Code, Civil Code - CIV § 55.53
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For purposes of this part, a certified access specialist shall, upon completion of the inspection of a site, comply with the following…
Source Link - 3 CALIFORNIA HEALTH AND SAFETY CODE SEC. 25249.6
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Required Warning Before Exposure To Chemicals Known to Cause Cancer Or Reproductive Toxicity. No person in the course of doing business shall knowingly and intentionally expose any individual to a chemical known to the state to cause cancer or reproductive toxicity without first giving clear and reasonable warning to such individual, except as provided in Section 25249.10.
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