Commercial lease renewal requirements and essential evidence

If there’s one thing that a pizzeria, a doctor and a shoe store have in common, it’s the importance of being well located and customers knowing where to find them. If the property is not owned, preserving the commercial location is one of the entrepreneur’s biggest concerns and a good negotiation in the renewal of the commercial lease is essential for those who are already established in the region and do not want to lose customers because of the end of the lease agreement. For this, the lessee must be aware of the requirements for lease renewal.

For the lessee to preserve the business location, the lease must be contracted in writing, with an uninterrupted validity of at least 5 years, the last 3 in the same activity, in addition to being up to date with the obligations and also fulfilling other requirements, which we will see as following.

In order for the contract to be renewed with conditions appropriate to the reality of the real estate market, the contract must have been signed by writing and with a fixed term of at least five years, even if the successive and uninterrupted contracts previously signed are added to that end, in addition, the company must have been engaged in the same activity in the last 3 years.

In addition to the term, there are other requirements: The lessee will have to present proof of the exact fulfillment of the contract in progress, through any proof of payment related to the lease, that is, he cannot be overdue with the contractual obligations, including ancillary ones. Another essential point is the clear and precise indication of the conditions offered for the renewal of the lease, in order to allow the lessor to analyze them and examine whether or not it will be convenient to accept them. In this way, the rent value, the frequency of correction, contractual obligations, guarantees and other essential aspects of the lease will need to be addressed

If the guarantee for the new period to be renewed is the trustee (guarantor), the data for the complete qualification of the guarantor must be informed, as well as the guarantor’s acceptance of the guarantee of the contract – if married, also signed by the spouse (Sumula 332 /STJ) –, with the aim of proving, from the outset, agreement and financial suitability.

In view of the above, the relevance of the performance of a lawyer specialized in Real Estate Law is notorious in order to carry out the Renovation Action with excellence, observing all the requirements and assumptions established by law so that the business location is in fact preserved.