Negotiating and drafting commercial leases

Commercial leases are a complex and technical field, requiring great care in negotiating and drafting leases, as well as in the deeds to be drawn up during the life of the lease.

The requirements of a commercial lease

A commercial lease is concluded for a minimum term of 9 years, and is renewable on the same terms beyond the initial 9-year period. It is therefore essential to carefully negotiate and draft the clauses and conditions of the lease at the outset.

HELLEBOID & ASSOCIÉS has extensive experience in advising both lessors and lessees in negotiating and drafting leases for commercial premises, stores, offices and warehouses.

Valérie HELLEBOID and Thomas APÉRY also draw up deeds to be issued during the life of a commercial lease. These may include deeds relating to the transfer of leasehold rights or the business, or the termination of the lease .

HELLEBOID & ASSOCIÉS represents its clients before the courts in the event of disputes between lessor and lessee , whether in proceedings to terminate a commercial lease, revise the rent, renew the lease, change the business through partial or full despecialization, or terminate the lease with or without fixing an eviction indemnity.

Valérie Helleboid, avocate en droit des baux commerciaux
cabinet d'avocat en droit des baux

Short-term derogatory leases and seasonal leases

In hyper-touristy commercial zones with very high rental values, such as the Golfe of Saint-Tropez and, more generally, the seaside resorts of the Côte d'Azur, various short-term leases are frequently used.

It is indeed possible to derogate from the status of commercial leases by granting the tenant a short-term lease known as a "bail dérogatoire" (“derogatory lease”) . Since 2014, the maximum term has been extended to three years.

Seasonal rentals are another special type of agreement, sometimes renewed by the same lessor and lessee, have given rise to numerous disputes, and the drafting of such agreements is particularly tricky.

HELLEBOID & ASSOCIÉS has the necessary experience to advise both lessors and lessees on the conclusion or litigation of these agreements, which are not covered by commercial leases.

Rent-setting proceedings before the Commercial Rents Judge

Rent may be revised upwards or downwards under certain conditions.

The commercial rent at the time of renewal of the lease is also subject to specific rules, which may or may not allow the rent to be de-capped. In the absence of agreement between the parties, the procedure takes place before a specific jurisdiction, namely the Juge des Loyers (Commercial Rent Judge), which depends on the Tribunal Judiciaire (Judicial Court). The Commercial Rent Judge frequently appoints an expert to give a technical opinion on whether or not the rent should be de-capped, and on the rental value of the commercial premises.

HELLEBOID & ASSOCIÉS assists both landlords and tenants in proceedings before the Commercial Rent Judge, and in the course of expert appraisals.

Eviction compensation for commercial premises

Except in the specific circumstances, the owner may not take over the premises without first paying the tenant an eviction indemnity .

The eviction indemnity includes, in particular, the market value of the business, determined in accordance with the practices of the profession, plus any normal removal and relocation costs, as well as the costs and transfer duties payable for a business of the same value, unless the landlord can prove that the loss is less.

In highly commercial areas such as the Golfe of Saint-Tropez and the seaside resorts of the Côte d'Azur, eviction compensation can represent a very substantial sum, even in the case of eviction of a tenant whose business is loss-making, if the value of his leasehold rights is high due to the location of the premises.

In the absence of an amicable agreement, the court sets the amount of the eviction indemnity, usually after a legal appraisal.

éviction de local commercial

Termination of commercial leases

It’s legally binding that commercial leases include a resolutory clause. In the event of the tenant breaching any of his obligations, and in particular in the event of non-payment of rent, this clause is a great tool enabling the lessor to obtain termination of the lease by means of a Procédure en Référé (quick procedeedings) before the local Court.

Maîtres HELLEOID and APÉRY have a lot of experience in going before this Juge des Référés in this type of lease termination dispute.

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