A commercial lease is often the largest contract a small business ever signs, and the first draft is almost always written by the landlord’s side. A commercial lease attorney reads the lease the way a courtroom eventually would, and fixes the terms that would hurt, before anyone signs.
VK Law reviews, negotiates, drafts, and litigates leases across California for both landlords and tenants, from single storefronts to multi-tenant and industrial properties. For a free consultation, call 877-780-4727.
What Should a Commercial Lease Attorney Review Before You Sign?
The rent number is rarely where a lease goes wrong. The expensive terms sit further in: operating costs and CAM charges, escalations, renewal and early-exit rights, assignment and subletting, personal guaranties, maintenance and repair obligations, and default and cure mechanics. California also requires every commercial lease to state whether the premises have been inspected by a Certified Access Specialist under Civil Code section 1938, with rescission rights if the rules are skipped.
Key Takeaways
- Almost every clause is negotiable, and the ones that decide cost are rarely the headline rent.
- Under Civil Code section 1938, a CASp report not delivered at least 48 hours before signing gives the tenant 72 hours after execution to rescind.
- Section 1938 presumes the landlord bears CASp inspection and repair costs unless the parties agree otherwise — which makes it a negotiating point, not a formality.
- Since January 1, 2025, small “qualified commercial tenants” have new statutory protections that landlord forms need to reflect.
- Comparing offers means comparing total occupancy cost, not the rent line.
What a Commercial Lease Attorney Reviews
- Operating costs and CAM charges: what share of taxes, insurance, and common-area maintenance the tenant pays, whether there is any cap, and whether the tenant can audit the books.
- Escalations: how and when rent increases, and what index or percentage drives it.
- Term, renewal options, and early exit: whether the tenant can stay, leave, or renegotiate as the business changes.
- Assignment and subletting: whether the business can be sold or the space shared without losing the lease.
- Personal guaranties: what the owners are personally on the hook for, and for how long.
- Maintenance, repair, and improvement duties: who fixes the roof, the HVAC, and the tenant improvements, and who pays.
- Default and remedies: how much room there is to cure a missed payment before the lease unravels.
Each of these is negotiable. Which ones matter most depends on which side of the table you sit on, and we work on both.
Disability Access: The CASp Rules in Civil Code Section 1938
This is the California-specific requirement most commonly skipped, and it carries a real remedy.
The disclosure. Under Civil Code section 1938(a), a commercial property owner or lessor must state on every lease form or rental agreement whether the premises have undergone inspection by a Certified Access Specialist. Where an inspection has occurred, the lease must also state whether the premises met the applicable construction-related accessibility standards.
The 48-hour rule and the rescission right. Under section 1938(b), the prospective tenant must have the opportunity to review any CASp report before execution. If the report is not provided at least 48 hours before the lease is executed, the tenant has the right to rescind the lease, based on the information in the report, for 72 hours after execution.
The seven-day follow-up. Where a CASp report indicates the premises meet applicable standards, section 1938(d) requires the lessor to provide the current disability access inspection certificate and any inspection report not already delivered within seven days of execution.
Where no certificate exists. Section 1938(e) prescribes specific language the lease must carry, including that a landlord may not prohibit a tenant from obtaining its own CASp inspection of the premises.
The cost point most parties miss. The amended statute presumes the property owner is responsible for the cost of a CASp inspection and of repairs needed to bring the premises into compliance — but the parties can agree otherwise. That makes the allocation of inspection and repair cost a term to negotiate deliberately rather than a default to inherit. Tenants are also generally required to keep the report’s findings confidential except as needed to complete repairs.
Protections for Small Tenants
For leases signed, commenced, or renewed on or after January 1, 2025, California gave “qualified commercial tenants” — broadly, microenterprises, restaurants with fewer than 10 employees, and nonprofits with fewer than 20 — new protections on rent-increase notice, lease termination, and how landlords pass through building operating costs, under Civil Code section 1950.9 and related sections.
Two drafting consequences follow. Landlord forms written before 2025 frequently do not account for them, and the tenant only gets the protections if it gives the landlord written notice of its status with the required attestation. Our commercial landlord-tenant page covers the rules and the enforcement consequences in detail.
Gross, Modified Gross, and Triple Net
The lease type decides who pays the building’s bills. In a gross lease, the rent number is close to the whole story: the landlord absorbs taxes, insurance, and maintenance. A modified gross lease splits them, often passing through increases over a base year. A triple net (NNN) lease pushes taxes, insurance, and common-area maintenance to the tenant.
Two spaces with the same headline rent can differ enormously in real cost. Comparing offers means comparing total occupancy cost, not the rent line — which is also why a CAM cap and an audit right are worth more in a NNN lease than almost anything else on the page.
From Letter of Intent to Signature
Most commercial leases start with a letter of intent covering rent, term, improvements, and options. The LOI is where leverage is highest, and where parties accidentally bind themselves with careless language — a non-binding LOI needs to say so.
From there: the landlord’s draft, negotiation rounds over the risk clauses, the guaranty conversation, and the delivery-condition and tenant-improvement terms that decide when rent actually starts. We work every stage, for either side.
Getting Out of a Commercial Lease
The honest answer is that it depends on what the lease says and how far the relationship has gone. The realistic routes:
- An early termination or break clause, if one was negotiated in — usually the cheapest exit, and the reason to negotiate one at signature.
- Assignment or sublet, subject to the landlord’s consent and the standard the lease imposes on refusing it.
- A negotiated surrender, where the parties agree terms for handing back the space, often with a payment and a release.
- Rescission under section 1938, in the narrow window where the CASp rules were not followed.
- Defences arising from the landlord’s own conduct, where the premises or the landlord’s performance fall short of what the lease requires.
Simply leaving is rarely one of them: the guaranty usually follows the owners out the door. Where negotiation cannot resolve it, our commercial landlord-tenant page covers the dispute and eviction side.
The Traps We See Most
For tenants: uncapped operating-cost pass-throughs with no audit right; relocation clauses that let the landlord move the business mid-term; personal guaranties with no sunset; restoration clauses that quietly obligate the tenant to un-build its improvements at surrender; and holdover rent at a punishing multiple.
For landlords: vague use clauses that invite disputes; consent standards written loosely enough to litigate; guaranties that expire with the first amendment; delivery-condition promises the building cannot keep on schedule; and lease forms that have not been updated for the 2025 small-tenant rules or the current section 1938 language.
What Lease Work Costs
Reviewing a lease before signature is one of the most defined engagements in this practice — a fixed scope, done in days, against a document that will govern years of occupancy cost. Negotiating a lease, or drafting a landlord form, is broader. Litigation is broader still.
We discuss the fee before starting, and the first conversation is free. If the answer is that your lease is fine and you do not need us, that is what we will tell you.
Commercial Leasing in San Mateo and on the Peninsula
Our office at 15 North Ellsworth Avenue, Suite 105, San Mateo, CA 94401 works with landlords and tenants across the Peninsula.
Two local conditions shape these leases. Older retail and mixed-use stock along the El Camino corridor and in the downtowns means CASp questions are live rather than theoretical — buildings predating current accessibility standards are common, and section 1938 puts the inspection and repair cost presumption on the landlord unless the lease says otherwise. And the small-tenant profile here matches the 2025 statute closely: owner-operated shops, small restaurants, and nonprofits are exactly what “qualified commercial tenant” describes, so Peninsula landlord forms need to account for it and tenants should know to give the notice.
Details about the office are on our San Mateo page.
How We Help
We review and mark up leases before signing, negotiate with the other side’s counsel or broker, draft lease forms and amendments for property owners, advise on CASp and small-tenant compliance, and handle the dispute when one arrives. Business owners with entity or contract questions can also draw on our California business law practice, and leasing sits within our broader California real estate practice.
To talk with VK Law about a lease, call 877-780-4727. The consultation is free.
This page provides general information about California law and is not legal advice; reading it or contacting the firm does not create an attorney-client relationship. Commercial leasing statutes are amended from time to time and should be confirmed against current text. Every situation is different, and prior results do not guarantee a similar outcome.
Reviewed by Alan D. Khalfin, Partner and Managing Attorney, Vaksman Khalfin, PC (admitted in California). Last reviewed: 08/28/2026
Frequently Asked Questions
For a lease of any real length or rent, generally yes. The first draft is written by the landlord's side, and the terms that decide total cost — operating cost pass-throughs, escalations, guaranties, restoration obligations — sit well past the rent line. A pre-signature review is a defined, short engagement against a document that governs years of occupancy.
It depends on scope. A pre-signature review and mark-up is a fixed, contained engagement. Full negotiation, drafting a landlord form, or litigating a dispute is broader. We discuss the fee before any work begins, and the first conversation is free.
Almost always, and more than tenants assume. Landlords expect mark-ups from represented tenants. Leverage is highest before the letter of intent is signed and drops steadily from there, which is why the LOI stage is the right time to raise the terms that matter.
A Certified Access Specialist inspects premises for compliance with construction-related accessibility standards. Civil Code section 1938 requires every commercial lease to state whether the premises have been CASp inspected, and where they have, whether they met applicable standards. The disclosure is mandatory even where no inspection has ever occurred.
Under section 1938(b), if the report is not provided at least 48 hours before execution, the tenant has the right to rescind the lease — based on the information in the report — for 72 hours after execution. Where a report shows the premises meet applicable standards, the landlord must also deliver the certificate and any report not already provided within seven days of execution.
The statute presumes the property owner is responsible for the cost of the inspection and of repairs needed to bring the premises into compliance, but the parties can agree otherwise. That makes cost allocation a term to negotiate deliberately rather than a default to inherit.
Broadly, a microenterprise, a restaurant with fewer than 10 employees, or a 501(c)(3) nonprofit with fewer than 20 — that has given the landlord written notice of that status with the required attestation. Qualifying tenants received new protections effective January 1, 2025 on rent-increase notice, termination, and operating-cost pass-throughs.
A lease under which the tenant pays taxes, insurance, and common-area maintenance on top of base rent. Two spaces with identical headline rent can differ substantially in real cost depending on lease type, which is why offers should be compared on total occupancy cost.
Through an early termination clause if one was negotiated, assignment or sublet subject to the landlord's consent, a negotiated surrender, rescission under section 1938 in the narrow window where the CASp rules were not followed, or defences arising from the landlord's own conduct. Simply leaving is rarely an option, since the personal guaranty usually follows the owners.
Often, yes. Guaranties can be capped in amount, limited in time, or structured to burn off as the tenant performs. Whether that is achievable depends on the deal, but it is one of the terms most worth raising before signature — and one that landlords should check survives any later amendment.
