A business that leases real estate and improvements (buildings, etc.) in the form of space for offices, a warehouse, a restaurant, a nail or hair salon, a clothing store, a coffee shop, or other commercial (nonresidential) space will usually be required to sign a written contract known as a commercial lease agreement.
The tenant (the business occupying the space) who signs a commercial lease agreement is generally expected to be a more savvy, sophisticated, and informed tenant (also known as a lessee) than a tenant in a residential lease, and the law usually does not provide a commercial tenant with the same protections as residential tenant receives.
Because the law does not provide a commercial tenant with many protections, it is up to the commercial tenant to read, understand, and negotiate protections in a proposed lease agreement before signing it, as most every paragraph in a commercial lease agreement can have a significant impact on a business’s operations and financial stability.
As with most other questions, a commercial tenant's ability to break or terminate a lease before the end of the lease term depends primarily on the terms of the written lease agreement.
In Washington State, businesses entering into commercial lease agreements for various types of nonresidential spaces, such as offices, warehouses, or retail stores, are expected to engage in these contracts with a higher degree of sophistication compared to residential tenants. Commercial tenants are not afforded the same level of legal protections as residential tenants, which means they must be diligent in reviewing, understanding, and negotiating the terms of the lease agreement. The lease document will dictate the rights and obligations of the tenant, including the conditions under which the lease may be terminated before its expiration. It is crucial for a commercial tenant to thoroughly analyze every clause in the lease, as these can significantly affect the business's operations and financial health. If a commercial tenant needs to break the lease early, the ability to do so will depend on the specific provisions outlined in the lease agreement. An attorney can provide valuable assistance in interpreting and negotiating the terms of a commercial lease to protect the tenant's interests.