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By John R. Merlino Jr. Esq.
Founding Attorney

When signing any contract, the onus is on you to understand the content and look out for your own best interests. However, sifting through legalese can be tedious and confusing. 

This is why it’s essential to consult with a lawyer before signing a commercial lease agreement. Here are three major areas to cover when you meet with a qualified real estate attorney.

1. What are all of the costs I might encounter?

In addition to your base rent, you may be liable for several other costs, some of them unknown. It’s important to understand what these costs are before you sign any lease agreement. 

Factors like CAM fees, maintenance costs, and a personal guarantee are commonly included in commercial leases. You need to know whether they’re in your contract so you have the chance to negotiate for the most favorable terms.

CAM Fees

Commercial Area Maintenance, or CAM fees, might include a range of costs related to the operation and maintenance of common areas within a commercial property. Common areas could include:

  • Hallways
  • Stairwells
  • Elevators
  • Restrooms
  • Loading docks/delivery areas
  • Parking lots or structures
  • Exterior lighting, irrigation, or other utilities
  • Landscaping
  • Sidewalks

Property taxes, as well as janitorial services, waste management,  and managerial and administrative fees, could also be included. Ask for a full accounting of these costs, the percentage you’re liable for, and planned increases, as these expenses could significantly increase your anticipated rent.


Maintenance fees are typically a separate cost that’s not included with CAM fees. While it seems like the landlord should be responsible for standard maintenance, don’t be surprised if these costs are passed on to tenants.

For your own protection, you need to make sure the lease includes language that states the landlord is responsible for maintaining the property, including roofing and ceilings, walls, and shared systems like plumbing, electrical, and HVAC. From there, you may be able to negotiate associated costs or the percentage you’re liable for.

Personal Guarantee

It’s not uncommon for lease agreements to include a personal guarantee. This essentially states that you take personal responsibility for the lease and any associated liabilities if your business fails to pay as agreed.

If this is included, you should try to negotiate for limitations on the dollar amount and period you’re liable for. If you have a three-year lease, you could request that your personal liability expire after a year, provided you meet all terms of the lease (making timely payments, etc.).

Leases involving two or more partners often hold each personally responsible for the full guarantee amount. In this case, you should negotiate for a specified percentage for each partner.

2. What terms and stipulations should I include?

If you uphold your side of the deal, you want to make sure your landlord does the same. This means working with your lawyer to ensure that all your terms are met. Before you sign the agreement, make sure the lease amount and term are what you agreed on.

If you’re a franchisee, check that the lease allows you to meet your contractual obligations to the franchisor. Look for guarantees related to any extras you were promised, such as a patio area, dedicated parking spaces, and so on.

3. Are the permitted uses appropriate for my needs? 

When you lease a property, you might naturally assume that your business will be allowed to operate. However, this isn’t guaranteed. It’s incumbent on you to understand the permitted use of the property. If the lease doesn’t specify your type of business, or if there are excessive restrictions that hamper your ability to operate, you’ll need to negotiate for more favorable terms or take your business elsewhere.

Creating the Right Contract for Commercial Use

When you work with a qualified real estate attorney, you have the best opportunity to fully understand the costs involved and negotiate for terms that meet your needs and preferences. Contact the experienced professionals Merlino & Gonzales today to find the right Staten Island lawyer for you.

About the Author
John is a fierce advocate and the office guru for problem-solving and brainstorming. He guides clients through every stage of a real estate transaction from offer to contract, navigating through nerve-shattering home inspection and title clearance concerns, maintaining constant contact with lenders, conducting the actual closing, and continuing to advise clients with regard to any post-closing concerns.  John brings a practical and fair-minded approach to the process which has earned him the respect of his clients and peers.