Why this matters
A commercial lease is long-term debt disguised as a monthly bill — five years at $4,000 a month is a $240,000 commitment, often personally guaranteed. Commercial tenants get almost no statutory protection: what the document says is what you get.
What "done" looks like
- An attorney experienced in commercial leases has marked up the draft
- You know exactly what you personally guarantee, for how long, and how it burns off
- CAM/operating-expense pass-throughs are capped, or at least defined and auditable
- Assignment, sublease, and default provisions understood before signing
How to do it
- Hire a commercial real estate attorney for a flat-fee review — small money against the lease value.
- Focus on the personal guarantee: push to cap it in time or amount, or convert it to a surrender-based ("good guy") form.
- Scrutinize CAM clauses: what's included, how it's allocated, annual caps, and audit rights.
- Check assignment and sublease rights — your exit if you ever sell the business.
- Confirm delivery condition and repair duties, including who owns HVAC failures.
Common mistakes
- Skipping review to save $1,000 on a six-figure obligation
- Reading base rent carefully but skimming CAM, taxes, and insurance pass-throughs
- Signing an unlimited personal guarantee when a capped or burn-down guarantee was negotiable
Real-world examples
- "Good guy guarantees" — personal guarantees that end when the tenant surrenders the space in good condition — are a documented standard in New York City commercial leasing: guarantees are negotiable structures.
- In triple-net (NNN) leases, tenants pay property taxes, insurance, and maintenance on top of base rent — CAM disputes are a routine source of landlord-tenant conflict.
From a founder's point of view
The scary line in a lease is rarely the rent — it's the guarantee that follows the founder home and the pass-throughs that grow every year. Legal review is the rare purchase where the protected downside is a hundred times the fee.
Rule of thumb
If you can't explain your personal guarantee and your CAM cap in one sentence each, the lease isn't ready to sign.