Legal fields

Both parties are businessmen when leasing commercial premises, and the principle of contractual freedom applies. On the one hand, there is no tenant protection as in apartment tenancy law, on the other there is no possibility to change the rent without agreeing. The content of the contract is essentially a matter of negotiation.

Essentially, the only restrictions on drawing up rental contracts are in the scope of checking the General Terms and Conditions (AGB). This can, however, result in significant consequences: if a clause in a commercial rental agreement does not “hold up” – which happens more and more frequently in view of judgments that are becoming continuously stricter – the law applies, and thus often precisely the opposite of what was intended.

Tenants of a commercial property need to understand in any case what lies behind individual clauses and what risks can arise from this. Most of all, they need to know that the risks of achieving entrepreneurial objectives with the premises are borne by the tenant.

With a long-term contractual relationship, both parties must always bear in mind not to fall into the “trap” of written form – a circumstance that is often overlooked in day-to-day business and can lead to unforeseen and undesired terminations.

For landlords and tenants alike, a prudent negotiation strategy and legally secure contract preparation are necessary. From our law practice as well as our lecturing activities, we know what arrangements are truly important.

We advise and represent you

• when negotiating before concluding a contract for a commercial property, preliminary lease contracts, Letters of Intent (LOI), lease options;

• when drawing up commercial rental agreements that are legally secure,

  • in the correct designation of the parties to the rental contract and the necessary signatures under the rental contract,

  • on the term and duration of the commercial rental agreement, particularly on clauses for leases for a limited period and extension options or exclusion of termination,

  • on the leasing purpose [Mietzweck], which in many commercial rental agreements is defined too imprecisely,

  • on drafting rent increase or rent escalation clauses, for instance through graduated rental agreements, automatic stable value clauses, service proviso clauses, price and cost element clauses, sales-based rents [Wertsicherungsklauseln],

  • on the question of under what prerequisites an option for VAT is possible with rent for commercial premises,

  • when drafting clauses on subletting,

  • when drafting a correct catalogue of utility and operating costs [Betriebskosten],

  • on questions about clauses protecting tenants’ economic interests, clauses on the obligation to operate, fixed range of products, tenant easements, advertising collectives, etc.,

  • on the question of maintenance and repair obligations [Instandhaltung und Instandsetzung], particularly on full repairing and insuring clauses or triple net agreements

  • on clauses excluding rent reduction and bans on offsetting;

• related to existing tenancies

  • on avoiding the “trap” of written form by drafting addenda to the rental agreement that are legally secure,

  • for negotiations on necessary contractual changes or contractual adjustments, for instance if on the landlord’s side large-scale remedial measures in the commercial property are planned (modification, adding floors). Renegotiations are often necessary in such cases to be able to conduct the specific measure in a legally secure manner.

  • to secure rents receivable if there are liquidity difficulties on the tenant’s side: here it is important to find viable solutions and to avoid later challenges against insolvency.

  • in case of the tenant’s insolvency if the tenant makes use of insolvency protection proceedings [Schutzschirmverfahren] or else to defend against rescissions under insolvency law on the part of an insolvency administrator after the restructuring has failed;

• for termination of the tenancy relationship

  • when formulating and serving terminations for good cause [Kündigung aus wichtigem Grund] that are legally secure, particularly due to default of payment,

  • verifying or defending against exit strategies due to a flaw in written form [Schriftformmangel];

• after termination of the tenancy relationship

  • when enforcing eviction claims against tenants, sub-letters and other third parties,

  • in case of disputes about the condition of the rented area,

  • in questions on compensation for damage, compensation for use, and the like