A commercial lease agreement is the contract a business signs to rent space for work rather than living: an office, a shop, a studio, a small warehouse. Landlords with a few units and small business owners renting their first space use it most. This free commercial lease agreement template is in Word and PDF, is written in plain English, and lets you pick a gross or net rent structure.

When do you need a commercial lease agreement?

Use it any time a business is renting space to operate from. Picture the owner of a small strip of four storefronts, with a local bakery that wants the end unit for three years at $2,600 a month. Or picture the baker, who wants the deal in writing before you spend $40,000 on ovens. Either way, this is the document.

If someone will live in the space, even part-time, a residential lease agreement is the better starting point, since residential rules would likely apply. And if a business tenant wants to hand part of its space to another company, that’s a commercial sublease, which our residential sublease agreement isn’t built for.

What should a commercial lease agreement include?

Here’s what each section of our template does.

Parties and premises. The landlord and the tenant’s exact legal business name (the LLC or corporation, not the owner personally, unless that’s the deal). Describe the space by address, suite number and approximate square footage.

Permitted use. What the tenant may do in the space. Be specific. “Retail bakery with on-site baking and seating for up to 20” tells both sides what’s allowed.

Term and renewal. Start date, end date, and any option to renew with how much notice the tenant must give to use it.

Rent and increases. Base rent, due date, and a blank for scheduled increases, such as a fixed percentage each year.

Lease type and operating costs. This is where commercial leases differ most from residential ones. In a gross lease the landlord covers operating costs from the rent. In a triple net lease the tenant pays rent plus property taxes, insurance and maintenance. The template has checkboxes for gross, net, or a modified version where you list who pays what.

Security deposit. Amount and return timing.

Maintenance and repairs. Who handles the roof, structure and building systems, and who handles the interior. Write this down carefully. A vague repair clause is an easy way to end up arguing over a $9,000 HVAC bill.

Improvements and signage. Whether the tenant can build out the space, who owns the improvements at the end, and sign rules.

Insurance and indemnity. The tenant carries general liability insurance at a set amount and names the landlord as additional insured. Each side covers claims caused by its own negligence. We deliberately didn’t write a clause making one side responsible for the other’s gross negligence or willful misconduct.

Assignment, default and boilerplate. Consent for subletting, what counts as default and how long there is to cure it, notices, governing law, and e-signing.

What do you need to check before signing?

The biggest thing to know is that commercial tenants get far fewer legal protections than residential tenants. A 2024 report from the Office of Legislative Oversight in Montgomery County, Maryland, puts it plainly: most state and local jurisdictions don’t give commercial tenants the extensive protections residential tenants get, because commercial parties are treated as businesspeople who can protect themselves. The same report found that Maryland has very few protections for commercial tenants. So whatever the lease says is, in practice, most of what you get.

That has a few practical consequences:

  • Zoning and permits. Confirm with your city or county that the permitted use is allowed at that address before you sign. The lease can’t fix a zoning problem.
  • Personal guarantees. Some landlords ask a small business owner to personally guarantee the lease. That’s a separate document with serious consequences, and you should read it with a lawyer.
  • Real total cost. On a net lease, ask for the last couple of years of tax, insurance and maintenance charges so the base rent isn’t the only number you look at.

For a multi-year lease with a buildout, have a lawyer read it. This template is a solid starting point for a straightforward small space, not a replacement for advice on a big commitment.

How do you fill it in and get it signed?

  1. Fill in the legal names exactly as registered, and the person signing for each business and their title.
  2. Pick the lease type and complete the operating cost section. If it’s modified gross, list each cost and who pays it.
  3. Attach a floor plan or space description and any building rules.
  4. Have the tenant sign first, then the landlord countersigns. Everyone keeps a copy of the complete signed version.

A commercial lease can generally be signed electronically. The federal ESIGN Act says a contract can’t be denied legal effect just because it’s electronic, and commercial leases aren’t on its list of exceptions. If the lease will be recorded (some long-term leases or memoranda of lease are), check the county recorder’s requirements first, since the recording office sets its own rules on signatures and notarization. Our article on which documents can’t be signed electronically covers the edge cases.

Download it, fill in the blanks, and send it for e-signature with any tool you like. (This is the job we’re building SignWren to do; you can join the waitlist.)

This template and guide are general information, not legal advice. For a specific lease or dispute, talk to a lawyer licensed where the property is.