An Overview of Lease Agreement to Share Offices

The real estate market is about to undergo major changes, as we can already see in the field of rental housing.

In recent months, taking advantage of the rise of the collaborative economy, companies, semi-public companies and public entities (most of them municipalities) are optimizing the use of their empty spaces by making them available to the public professionals in return for remuneration. These empty spaces are mainly IT office space in Delhi.

In fact, companies or public entities that own, rent or occupy large office space do not always use all the space they enjoy. Some of them make them available to third parties by also offering services.

This phenomenon is encouraged both by the many new businesses in the digital domain and by the development of coworking, freelance work and new ways of organizing work (telecommuting and mobile work) allowing employees to work on certain days in premises near their home.

The managers wanted to adapt to this new need, making the provision of premises accompanied by services, a full-fledged activity, modernizing the already existing business centers. The methods for making these spaces available and their use are varied, both in terms of the duration (from a few minutes to several months) and the services that can accompany them.

Like the short-term rental of residential premises, which poses many problems, these new uses are not devoid of legal issues, each actor must be attentive.

I. On the elements to check prior to the provision of premises:

The provision of the premises can be proposed either directly by the owner or by the tenant. Prior to this provision, it is necessary to check certain elements. Firstly, the provision and activity of the beneficiary must comply with the purpose of the premises as defined by the planning documents. These premises must also be adapted to the activity of the beneficiary and comply with the standards in force in this respect.

II. On the choice of the contract concluded for the provision of the premises:

The choice of the contract allowing the temporary provision of a commercial or office space must be carefully apprehended by the parties. The service contract is widely used in business centers in Delhi or coworking spaces in that it is perfectly suited to the provision of premises for very short periods. These services differ from the rental charges.

These services can be multiple: provision of computer and telecommunication equipment, reprography, meeting room, provision of personnel, household, domiciliation (activity subject to pre-approval) or mail management. The mere qualification of a service contract is not enough.

The services offered must be real and the provision must actually be the accessory of those services. Otherwise, the contract will be requalified in the commercial lease. Except to demonstrate a public interest and a lack of private initiative in a given area, public persons wishing to make available the premises of their private domain cannot conclude service contracts to not go beyond of their competence.

Businesses and public entities (if the premises are not in the public domain) may also enter into short-term leases to temporarily provide office or commercial premises. The short-term lease is a lease of something that derogates from the status of commercial leases.