Commercial Restaurant Lease Agreement template

Free commercial restaurant lease agreement 

Leasing a space for a restaurant, café, or commercial kitchen? Our free, customizable restaurant lease agreement is designed to help landlords and food service tenants quickly and clearly formalize the terms of a commercial real estate lease specifically for restaurant operations.

This commercial lease agreement and contract covers key elements such as monthly rent, lease duration, permitted use, tenant improvements, equipment maintenance, common area expenses (CAMs), utility and insurance responsibilities, and triple net (NNN) lease terms, if applicable. Our commercial lease agreement is ideal for restaurants of all shapes and sizes, from a small diner to full-service dining; any food service business moving into a leased space.

You can edit the commercial agreement online, send it through using Docusign’s popular digital signature features, and keep a signed copy stored securely in your account with the option to download or print the agreement whenever you need it.

What is a commercial restaurant lease?

A commercial restaurant lease is a legally enforceable contract between a landlord and a tenant for the rental of a property specifically intended for restaurant or food service operations. This document outlines the terms and conditions under which the tenant will occupy and operate their business in the leased space.

Essentially, the commercial restaurant lease agreement ensures both parties understand their obligations and rights. It protects the landlord's property investment while providing the tenant with the security of a dedicated business location. This agreement is tailored to the unique needs of restaurant businesses, considering elements such as kitchen equipment installation, health and safety regulations, and potential modifications to the space. It also often addresses special clauses relating to the restaurant industry such as permitted hours of operation, signage, and shared area maintenance fees.

What is included in a commercial restaurant lease agreement?

To better ensure a commercial restaurant lease is legally-enforceable, it must include certain terms and elements and adhere to applicable laws and regulations:

• Identification of parties: Clearly identify the landlord and tenant, including their legal names and contact information.

• Description of premises: Provide a detailed description of the leased premises, including the address, square footage, and any specific areas included (e.g., kitchen, dining area, storage).

• Use clause: Specify the permitted use of the premises, typically for operating a restaurant, and any restrictions on usage.

• Lease term: Define the duration of the lease, including the start and end dates, and any options for renewal.

• Rent details: State the base rent amount, payment schedule (e.g., monthly), and acceptable payment methods. Include provisions for rent adjustments, such as annual increases or adjustments based on sales or CPI.

• Security deposit: Outline the security deposit amount, conditions for its use, and procedures for its return.

• Operating expenses: Clarify tenant responsibilities for utilities, maintenance, and common area charges.

• Tenant improvements: Specify any allowances or approval processes for modifications or improvements to the premises.

• Maintenance and repairs: Define responsibilities for maintaining the interior and exterior of the premises, including structural repairs.

• Insurance requirements: Require the tenant to obtain liability and property insurance, specifying coverage amounts and types. State landlord insurance obligations.

• Indemnification: Include indemnification clauses where the tenant agrees to indemnify the landlord against claims arising from the tenant's use of the premises.

• Compliance with laws: Mandate compliance with all applicable laws, regulations, zoning ordinances, and health and safety standards.

• Assignment and subleasing: State conditions under which the tenant may assign or sublease the premises.

• Default and remedies: Define events constituting default and outline remedies available to the landlord, including eviction and recovery of damages.

• Right of entry: Specify the landlord's right to enter the premises for inspections, repairs, or showings, along with notice requirements.

• Termination clause: Outline procedures for termination by either party, including notice periods and conditions.

• Governing law: Specify the state law that governs the lease and the venue for legal disputes.

• Miscellaneous provisions: Include clauses on force majeure, waiver of jury trial, and the entire agreement.

Additional provisions

While not required, the following terms may enhance a sublease agreement:

• Fillable space for additional terms and conditions: Allow flexibility and space for additional terms and conditions specific to the restaurant industry, such as health inspections, liquor licenses, or outdoor seating arrangements.

• Dispute resolutions: Consider including a clause for resolving disputes, such as mediation or arbitration.

Types of commercial restaurant lease agreements

In general, there are several different types of restaurant leases that govern the relationship between landlord and tenant:

• Gross Lease: Tenant pays a fixed rent, and the landlord covers property taxes, insurance, and maintenance.

• Net Lease: Tenant pays base rent plus a portion of property taxes, insurance, and maintenance costs.

• Triple Net Lease (NNN): Tenant pays base rent plus all property taxes, insurance, and maintenance costs.

• Percentage Lease: Tenant pays base rent plus a percentage of gross sales.

• Hybrid Lease: Combines elements of different lease types, such as a base rent plus a percentage of sales after a specific threshold.