Articles & Resources
Who Does The Repairs In A Commercial Lease?
First, we need to know that there are 3 main obligations when it comes to taking care of the property:
Within those 3 obligations, there are 2 subcategories:
- INTERIOR vs EXTERIOR
- STRUCTURAL vs NON-STRUCTURAL
It is important that each lease should outline who is responsible for these 3 main obligations to avoid any confusion or having to go to court to have it decided.
Does It Matter If It Is A Net Lease Vs A Gross Lease?
IF the Tenant is signing a NET lease then the Tenant will:
- pay Base Rent + TMI/CAM/Additional Rent
- be responsible for doing the MAINTENANCE/REPAIR/REPLACEMENT and paying for it out of its own pocket
IF the Landlord is signing a GROSS lease then the Tenant will
- pay Base Rent ONLY
- NOT be responsible for doing the MAINTENANCE/REPAIR/REPLACEMENT or its costs
Ideally, the tenant would only want to be responsible for interior non-structural repairs and ordinary cleanliness.
What's The Difference Between Maintenance Vs Repairs?
- Maintenance typically is an ongoing obligation to "maintain" the condition of the building and its operations; to prevent the building's deterioration. Examples of maintenance include:
- Routine equipment servicing.
- Repair contemplates "fixing" a portion of the property that is already damaged.
What's The Difference Between Structural Vs Non-Structural?
Structural elements mean those which are necessary to hold the building together, such as:
- Floor structures.
Non-structural elements are all those except those above, such as:
- Partition Walls.
- carpeting or wall covering.