There are several reasons why you might wish to terminate a commercial lease earlier than anticipated. Therefore, if you are leasing commercial property, you may wish to include an early termination clause in your commercial lease to allow for this contingency. For example, if your business is extremely successful, you may outgrow your existing leased space before the end of your lease, which an early termination provision could allow. Additionally, if your business is failing, and you are unable to keep up with the lease payments, an early termination clause would allow you to exit the contract without defaulting on it. You might want to take your existing business in a new direction that no longer fits within the space that you have leased; again, an early termination provision could help you achieve your goals without breaching the lease.
Commercial landlords, however, may not be so quick or willing to terminate commercial leases earlier than planned. As a general rule, commercial landlords wish to enter into long-term leases so that they can avoid continually finding new tenants for their properties, losing money in the process. Therefore, you can expect that commercial landlords will want to include strong language in the commercial lease that calls for penalties in the event of the tenant’s early termination of the lease.
Entering into contracts is a crucial part of almost any type of business. Commercial leases are complex contracts that require quite a bit of business and legal knowledge in order to ensure that the lease provisions are fair and equitable. As a result, the parties to the contract must be aware of public policy considerations, laws, and/or court rulings that may void or cancel out some or all provisions in a contract, as well as their ability to terminate the lease earlier than anticipated. When you are seeking to enter into a commercial lease, Heit Law Group, P.C., is here to help. We care about you and your business, and, as a result, our California business law attorneys stand ready to represent your interests and give you the advice that you need. Contact your California business lawyer today and learn how we can advocate for your business in whatever legal matters arise.