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Commercial Lease Contract for Philippines

Commercial Lease Contract Template for Philippines

A commercial lease contract under Philippine law is a legally binding agreement that governs the rental of commercial property between a lessor (property owner) and a lessee (business tenant). This document encompasses crucial elements regulated by the Civil Code of the Philippines and related legislation, including detailed specifications of the premises, rental terms, duration, obligations of both parties, and conditions for use of the property. It incorporates specific requirements under Philippine law such as notarization requirements and compliance with local government regulations, while addressing key commercial considerations such as fit-out provisions, maintenance responsibilities, and security deposits.

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What is a Commercial Lease Contract?

The Commercial Lease Contract is essential for businesses seeking to establish operations in commercial spaces throughout the Philippines. This document is typically used when a business entity intends to rent office space, retail locations, industrial facilities, or other commercial properties for business purposes. The agreement must comply with Philippine legal requirements, including provisions from the Civil Code, Local Government Code, and relevant tax regulations. It should detail all aspects of the commercial tenancy, including rent payments, term duration, permitted use, maintenance obligations, and termination conditions. The document is particularly important as it provides legal protection for both the property owner and the business tenant, establishing clear rights and responsibilities while ensuring compliance with local business permit requirements and zoning regulations.

What sections should be included in a Commercial Lease Contract?

1. Parties: Identification of the Lessor and Lessee, including complete legal names, addresses, and tax identification numbers

2. Background: Context of the lease agreement, brief description of the property, and the parties' intention to enter into a lease arrangement

3. Definitions: Definitions of key terms used throughout the agreement

4. Premises: Detailed description of the leased property, including exact location, floor area, and permitted use

5. Term: Duration of the lease, commencement date, and conditions for renewal

6. Rent and Other Charges: Rental amount, payment schedule, security deposit, advance rent, and other financial obligations

7. Rights and Obligations of the Lessor: Lessor's responsibilities including maintenance, repairs, insurance, and property access rights

8. Rights and Obligations of the Lessee: Lessee's responsibilities including proper use of premises, utilities, minor repairs, and compliance with regulations

9. Alterations and Improvements: Rules regarding modifications to the premises and ownership of improvements

10. Insurance and Liability: Required insurance coverage and allocation of risks between parties

11. Default and Remedies: Events of default and corresponding remedies available to either party

12. Termination: Grounds for termination and the process for ending the lease

13. General Provisions: Standard clauses including governing law, notices, entire agreement, and amendment procedures

14. Execution: Signature blocks and notarial acknowledgment

What sections are optional to include in a Commercial Lease Contract?

1. Building Rules and Regulations: Required when the premises are part of a larger building or complex with specific rules

2. Assignment and Subletting: Include when the parties want to specifically address the possibility of transferring lease rights

3. Force Majeure: Particularly relevant in areas prone to natural disasters or when specifically requested by parties

4. Environmental Compliance: Required for properties where environmental concerns are significant or for specific business types

5. Operating Hours and Access: Necessary for premises in commercial complexes with restricted access times

6. Signage Rights: Important for retail or commercial spaces where exterior or interior signage is crucial

7. Exclusivity Clause: Include when lessee requires protection from competing businesses within the same property

8. Fit-out Period: Necessary when premises require significant renovation before business operation

What schedules should be included in a Commercial Lease Contract?

1. Schedule A - Property Details: Detailed description of premises including floor plans and technical specifications

2. Schedule B - Rent Schedule: Detailed breakdown of rent, escalation rates, and payment terms

3. Schedule C - Inventory of Fixtures: List of fixtures and fittings included in the lease

4. Schedule D - Permitted Use: Detailed description of allowed business activities and restrictions

5. Schedule E - Fit-out Guidelines: Technical specifications and requirements for premises modification

6. Schedule F - Building Rules: Comprehensive building regulations and operational guidelines

7. Appendix 1 - Form of Bank Guarantee: Template for bank guarantee if required as security

8. Appendix 2 - Handover Form: Template for documenting the condition of premises at handover

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Philippines

Publisher

Ƶ

Document Type

Agreement Contract

Cost

Free to use
Relevant legal definitions




































Clauses






























Relevant Industries

Real Estate

Retail

Food and Beverage

Professional Services

Healthcare

Manufacturing

Technology

Banking and Finance

Entertainment

Education

Logistics and Warehousing

Relevant Teams

Legal

Real Estate

Facilities Management

Operations

Finance

Procurement

Risk and Compliance

Business Development

Administration

Relevant Roles

Real Estate Manager

Property Manager

Facilities Manager

Legal Counsel

Corporate Lawyer

Business Development Manager

Operations Director

Chief Financial Officer

Commercial Director

Procurement Manager

Risk Manager

Compliance Officer

Real Estate Broker

Store Manager

Branch Manager

Industries






Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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