Updated: January 23, 2019
Sample Letter of Intent (LOI) for commercial leases. The Letter of Intent is very important negotiation instrument that you will need when renting or buying commercial space. LOIs are used to negotiate Office Space Leases, Industrial leases, Retail Leases, etc.
If you’re looking for the purchase version of a letter of intent, please visit: Letter of Intent to purchase commercial real estate PDF
If you’re in the process of searching for commercial real estate or negotiating a commercial lease, you will need access to a letter of intent to start negotiating with Landlords and Sellers of commercial property. There are 2 main variations of Letter of Intent (LOI) documents. One is for leases and one is for purchases. In this post we will give you access to the Lease version of the Letter of Intent.
You can download the Sample Letter of Intent (Microsoft Word Format) by clicking the button at the bottom of this post.
The Letter of Intent should include the names of the parties negotiating, such as the name of the Tenant and the Property Owner/Landlord, and a list of industry standard list items. You should also include items that are important to your business when leasing commercial real estate. If the section addressing something important to your business, create a new section, name it what you want and type away the issues you want addressed.
Industry standard things to make sure to include in the Letter of Intent are:
- Name of the parties negotiating (ie. Name of Tenant or Person trying to lease the commercial property and the Name of Landlord)
- Letter of Intent expiration date. (a good rule of thumb is to make Letters of Intent last no more than 5 business days)
- Language that says the LOI is a “non-binding” document and that it is simply an instrument used for negotiating a lease, not a contract
- If you have a special type of business use, make sure that your commitment to lease the property is subject to you getting approval from the City for your specified use.
- Address and Suite number of the property or space you are negotiating on
- The square foot size of the property or space you are negotiating to lease
- Type of rent (Triple Net, Modified Gross, Full Service Gross),
- Operating Expenses (who is responsible for property expenses.. you or the landlord)
- Signage cost: specifies whether the signage is free or paid
- Parking cost: specifies whether the parking is free or paid
- Sublease rights: allows a tenant to sublease their space
- Profit sharing on Subleases: If the tenant subleases the space for a higher dollar amount than they are paying, who gets to keep the profits… the Landlord or the Tenant?
- Free Rent or Abated Rent: How much free rent does the Tenant get from the Landlord and when
- Early Occupancy: can the Tenant move-in prior to the lease commencement date to set-up their office free of charges, and for how long
Many of these industry standard items are included in the Sample Letter of Intent to Lease Commercial Real Estate below.
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