If you’re starting or relocating a business, securing the right commercial lease is one of the biggest decisions you’ll make. But for many, it’s unfamiliar territory — full of jargon, small print, and long-term financial commitment.

This guide breaks down what you need to know before signing a commercial lease — and how to avoid common mistakes.

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What is a commercial lease?

A commercial lease is a legal agreement between a landlord and tenant that gives a business the right to occupy a property for a defined period. Unlike residential lets, there’s far less regulation — meaning more flexibility, but also more responsibility for the tenant.

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Key terms to understand

Here are the essentials to look out for in any lease agreement:

1. Lease Term

How long the agreement lasts. Typical terms range from 3 to 15 years. Check for:

• Break clauses (allowing early exit)
• Renewal rights under the Landlord and Tenant Act 1954

2. Rent & Reviews

What you’ll pay, and how often the rent can increase. Watch for:

• Upward-only rent reviews
• RPI-linked increases (inflation-based)
• Service charges for communal areas

3. Repair Obligations

Many leases include FRI (Full Repairing and Insuring) terms — meaning you’re responsible for all maintenance and repairs, even if issues pre-date your tenancy.

4. Use Class & Restrictions

The lease will define what the property can be used for (e.g. retail, office, light industrial). You may need planning consent to change use.

5. Alterations & Fit-Out

Some leases restrict structural or cosmetic changes. Always seek written permission before refurbishing or adapting the space.

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Tenant responsibilities (often overlooked)

• Building insurance – often paid by you via landlord
• Business rates – unless exempt or reduced via Small Business Rate Relief
• Utilities, refuse collection, PAT testing, fire safety
• Reinstatement – you may need to return the space to its original condition at lease end

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Dilapidations: a costly surprise if ignored

Landlords can claim for damage or disrepair at the end of a lease. This is known as a dilapidations claim, and it can run into thousands.

Tip: Schedule a condition survey before signing and negotiate a Schedule of Condition to limit liability for existing wear and tear.

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Commercial leases are negotiable

But only if you know what to ask. That’s where working with a commercial agent helps.

At Fisher Wrathall Commercial, we:

• Match you with suitable properties in Lancaster & the wider North West
• Advise on lease terms and fair market rent
• Liaise with landlords and solicitors
• Help you plan for growth, expansion, or exit

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Ready to find your next business premises?

Whether you’re launching a new venture or expanding an existing one, we’ll help you secure the right space on the right terms.

📞 Call: 01524 69922
✉️ Email: info@fwcommercial.co.uk
🌐 Browse listings: fwcommercial.co.uk/search-property