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Four Errors of Business When Renting Premises

Posted on February 21, 2018March 20, 2024 by Jain Estates Oncor International

How to choose premises and conclude a contract, then not to sue the landlord?

Rent of commercial real estate in a crisis remains for business the cheapest way to provide itself with an office, warehouse for rent in Gurgaon or retail space. But the tenant should be carefully approached as to the choice of the object of lease, and to the agreement of the terms of the agreement with the lessor. What common mistakes do tenants make?

Rent an object for which there is no permit for commissioning. When constructing premises for leasing, developers often enter into contracts and receive security payments from tenants until they receive permission to enter a building or structure into operation. Therefore, the lessee must first ascertain the legality of the leased premises: ask the landlord for a building permit, as well as documents on rights to the land plot, land categories and the type of permitted use.

Rent self-construction is often the subject of consideration in arbitration disputes. Thus, the organization that leased the last two floors in a six-story building required collection from the lessor of the amounts paid under the lease agreement, which had previously been declared invalid by the court. The reason- rented floors were built on a four-story building and had all the signs of unauthorized construction. All instances refused to the tenant to collect money.

Also tenants need to take into account that they cannot use leased premises for their purposes in a building not put into operation. The landlord in this situation is entitled to transfer the premises to the lessee only for repair work. Any other activity in such a building is prohibited and punishable by an administrative fine in accordance.

Unclear separation of costs for utility bills- The lessor and the lessee can independently agree on whom the expenses for the maintenance of the leased property, i.e., utility payments, will be assigned. Inexperienced tenants do not always pay attention to this item when drafting a contract, which often leads to unforeseen expenses, and sometimes to litigation. The practice of courts is unequivocal: the lessee is obliged to bear the costs of maintaining the property, unless otherwise stipulated by the contract.

Non-agreed purposes of use- Each company when choosing a rented property in Gurgaon is repelled from its own goals. When drawing up a contract, such goals should be agreed with the lessor and, in addition, must correspond to the designation of the premises provided for in the project and technical documentation.

Uncoordinated improvements in the leased premises- The tenant often has a need to re-equip the premises to meet the needs of the business. All improvements, as well as related costs, must be agreed with the landlord in advance in order to avoid negative consequences. The laws presuppose two types of improvements to leased property: separable and inseparable, but the criteria for their determination are vague. Therefore, the issue of improvements is recommended to be agreed separately in the contract.

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