Just like a residential rental or lease, your commercial landlord is going to insist on a security deposit. The security deposit can be used by the landlord for a number of reasons, but most commonly it will be used to cover any damage at the end of your lease if you do not renew your agreement.
Unlike residential leases, there aren't any laws that govern how much a commercial landlord can ask for a security deposit. Your landlord may ask for a very large deposit; how much depends on you bargaining power. Additionally, you landlord may earn interest on your security deposit, and unless you work it into your lease, you won't see any of that additional income.
As a result of the rather lax legal setting, you will want to include (as much as possible) favorable security deposit terms in your commercial lease. The articles below address this issue in detail.
Using a Letter of Credit (Not a Security Deposit) for Commercial Property
In some cases, a bank will guarantee payment to the landlord in lieu of a cash deposit from you.
Getting Your Security Deposit Back When Renting Commercial Space
You should get your deposit back at the end of your lease, and you may even be able to get it earlier.
Negotiate the Best Lease for Your Business
Need space for your business? This practical handbook explains how to analyze space needs, find the ideal location and then get the best possible terms.
This form contains everything businesses and landlords need to create their own gross lease.
If you wish to sublease space to another business, this is the form you need.
Commercial Net Lease for Entire Building
This form contains everything businesses and landlords need to create their own net lease for a building.
Commercial Net Lease for Part of Building
This form contains everything businesses and landlords need to create their own net lease for a space within a building.
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