California retail lease agreement template

California Retail Lease Agreement

This California Retail Lease Agreement (the “Lease”) is made and entered into as of this [Date] by and between:

Landlord: [Landlord Legal Name], a [Landlord Entity Type, e.g., Limited Liability Company], with a principal place of business at [Landlord Address], and, if applicable, a registered agent at [Registered Agent Name] located at [Registered Agent Address]. Contact Person: [Landlord Contact Person], Email: [Landlord Email], Phone: [Landlord Phone].

Tenant: [Tenant Legal Name], a [Tenant Entity Type, e.g., Corporation], with a principal place of business at [Tenant Address], and, if applicable, a registered agent at [Registered Agent Name] located at [Registered Agent Address]. Contact Person: [Tenant Contact Person], Email: [Tenant Email], Phone: [Tenant Phone].

1. Premises

Description: The Landlord leases to the Tenant, and the Tenant leases from the Landlord, the retail premises (the “Premises”) located at [Property Address], Suite/Unit Number [Suite/Unit Number], Assessor Parcel Number (APN): [APN].

Square Footage:

Option A: The Premises contains approximately [Usable Square Footage] usable square feet and [Rentable Square Footage] rentable square feet.

Option B: The square footage is as shown on Exhibit A, attached hereto and incorporated herein.

Common Areas: Inclusion of common areas is [Included/Excluded] as depicted in Exhibit A.

Specific Features: Storefront Dimensions: [Storefront Dimensions], Customer Access Points: [Number], Designated Parking Spaces: [Number], Loading Docks: [Number (if any)], Signage Locations: [Description].

Boundaries: Delineation of boundaries and exclusive/shared areas: [Detailed Description, e.g., "Tenant has exclusive use of the storefront display windows facing Main Street. Shared service corridor access is as depicted in Exhibit B."].

2. Use of Premises

Permitted Use: The Premises shall be used solely for the purpose of [Detailed Description of Permitted Retail Use, e.g., "the operation of a retail clothing store specializing in women's apparel"].

Restrictions:

Option A: Tenant shall not change the use of the Premises or the method of operation without Landlord’s prior written consent, which consent may be withheld in Landlord’s sole and absolute discretion.

Option B: Tenant shall operate within City zoning codes ( [Cite Specific Code]) and Conditional Use Permits ( [Permit Number]).

Prohibited Activities: The following activities are strictly prohibited: hazardous activities, alcohol or tobacco sales (unless expressly permitted with proper licenses), and any use that may violate California or local regulations, create a nuisance, or violate exclusive use covenants for other tenants. Proposition 65 compliance is mandatory.

3. Term

Lease Term: The term of this Lease shall be [Number] years, commencing on [Commencement Date] (the "Commencement Date") and expiring on [Expiration Date] (the "Expiration Date").

Possession:

Option A: Landlord shall deliver possession of the Premises to Tenant on or before the Commencement Date, subject to delays caused by Force Majeure.

Option B: If Landlord fails to deliver possession by [Date], Tenant shall have the right to terminate this Lease.

Renewal/Extension Options:

Option A: Tenant shall have the option to renew this Lease for [Number] additional term(s) of [Number] years each, provided Tenant gives Landlord written notice of its intent to renew at least [Number] months prior to the Expiration Date.

Option B: No renewal option.

Early Termination: Tenant shall/shall not have the option of early termination under the condition it gives landlord a notice of [Number] months and pays [Dollar amount] or [Percentage]% of the total remaining rent.

4. Rent

Base Rent: The Base Rent for the Premises shall be [Dollar Amount] per month, payable in advance on the first day of each month, commencing on the Commencement Date.

Rent Escalation:

Option A: The Base Rent shall increase annually by [Percentage]%.

Option B: The Base Rent shall be adjusted annually based on the Consumer Price Index (CPI) for [City/Region].

Option C: Fixed increase on [Date]: [Dollar amount].

Percentage Rent:

Option A: In addition to Base Rent, Tenant shall pay percentage rent equal to [Percentage]% of Gross Retail Sales exceeding [Dollar Amount] per year.

Option B: No percentage rent.

Sales Reporting: Tenant shall provide Landlord with monthly/quarterly/annual gross sales reports, certified by an officer of Tenant, within [Number] days after the end of each period. Landlord shall have the right to audit Tenant's sales records upon reasonable notice.

5. Security Deposit

Amount: Tenant shall deposit with Landlord a security deposit in the amount of [Dollar Amount], which shall be held by Landlord as security for the performance of Tenant’s obligations under this Lease.

Deductions: Landlord may deduct from the security deposit any amounts necessary to cure any default by Tenant, including, but not limited to, unpaid rent, damage to the Premises, and costs of cleaning and repair.

Return: The security deposit, less any deductions, shall be returned to Tenant within [Number] days after the expiration or termination of this Lease and Tenant’s surrender of the Premises. California law governs interest on security deposits (if applicable).

6. Operating Expenses (NNN/Modified Gross/Gross)

Lease Type: This Lease is a [Triple Net (NNN)/Modified Gross/Gross] lease.

Pass-Throughs: Tenant shall pay its proportionate share of Operating Expenses, including, but not limited to, property taxes, common area maintenance (CAM) charges, building insurance, utilities (water, sewer, electricity, gas), trash collection, and janitorial costs.

CAM Charges: CAM charges shall be allocated based on the ratio of the rentable square footage of the Premises to the total rentable square footage of the building.

Reconciliation: Landlord shall provide Tenant with an annual statement of Operating Expenses, and Tenant shall have the right to audit Landlord’s records upon reasonable notice.

7. Compliance with Laws

Tenant shall comply with all applicable federal, state, and local laws, ordinances, and regulations, including, but not limited to, city/county planning, health, fire, signage, and retail operating regulations. This includes maintaining all required business licenses and sales tax permits.

ADA compliance obligations will be addressed based on areas of use and improvement responsibilities.

Tenant must comply with all hazardous materials disclosure laws in California.

8. Insurance

Tenant shall maintain the following insurance coverages: commercial general liability insurance ( [Coverage Amount]), property insurance ( [Coverage Amount]), workers' compensation insurance (if applicable), and business interruption insurance ( [Coverage Amount]). Landlord shall be named as an additional insured on Tenant’s commercial general liability policy.

Tenant shall provide Landlord with certificates of insurance evidencing the required coverages prior to the Commencement Date and upon each renewal thereafter.

9. Maintenance and Repair

Landlord's Responsibilities: Landlord shall be responsible for maintaining and repairing the roof, structure, and common areas of the building.

Tenant's Responsibilities: Tenant shall be responsible for maintaining and repairing the interior of the Premises, including front doors, windows, signage, store fixtures, and equipment.

Tenant shall promptly notify Landlord of any damage to or defects in the Premises or the building.

10. Alterations and Improvements

Tenant shall not make any alterations or improvements to the Premises without Landlord’s prior written consent, which consent shall not be unreasonably withheld.

Tenant shall submit detailed plans and specifications for any proposed alterations or improvements to Landlord for approval.

Any alterations or improvements made by Tenant shall become the property of Landlord upon the expiration or termination of this Lease.

11. Move-In/Move-Out

Prior to move-in, Landlord and Tenant shall conduct a joint inspection of the Premises and complete a condition report.

Upon expiration or termination of this Lease, Tenant shall surrender the Premises in good condition, reasonable wear and tear excepted, and shall remove all of its personal property.

Hold-over rent shall be [Percentage]% of the then-current Base Rent.

12. Signage

All signage shall be subject to Landlord’s approval and shall comply with all applicable municipal sign codes and center-specific design criteria. [Specify Details].

13. Miscellaneous

Pest Control: Responsibility for pest control will be held by [Landlord/Tenant] and conducted every [frequency].

Parking: Customer and employee parking rules, loading/unloading restrictions shall be as follow: [Details].

Continuous Operation: Tenant shall operate its business continuously during normal business hours, as determined by Landlord.

Sales Tax: Tenant shall be responsible for collecting and remitting all applicable California sales taxes.

14. Sublease and Assignment

Tenant shall not sublease the Premises or assign this Lease without Landlord’s prior written consent, which consent shall not be unreasonably withheld, subject to California Commercial Code and Civil Code §1995.210 et seq.

15. Casualty/Eminent Domain

In the event of damage or destruction to the Premises due to fire, earthquake, or other casualty, this Lease shall terminate at the option of either party. [Further Details, e.g., Abatement, Insurance Proceeds].

If the Premises are taken by eminent domain, this Lease shall terminate.

16. Default and Remedies

If Tenant fails to pay rent or otherwise defaults under this Lease, Landlord shall have all remedies available at law or in equity, including, but not limited to, termination of the Lease, eviction, and recovery of damages. Notice and cure periods will comply with California law (typically 3 days for rent, 30 days for other defaults). Jury trial waiver is included to the extent permitted.

17. Disclosures

Required disclosures under California Health and Safety Code (asbestos, mold, lead paint if pre-1978), Megan’s Law database notice, Natural Hazard disclosures, and any local City/County disclosures are attached as Exhibit [Exhibit Letter].

18. Guarantee

This Lease shall be guaranteed by [Guarantor Name], whose guarantee is attached hereto as Exhibit [Exhibit Letter].

19. Notices

All notices shall be in writing and shall be deemed given when delivered personally, sent by certified mail, or sent by email to the addresses set forth above.

20. Entire Agreement

This Lease constitutes the entire agreement between the parties and supersedes all prior or contemporaneous communications and proposals, whether oral or written. Any amendment to this Lease must be in writing and signed by both parties.

Severability, attorney’s fees to the prevailing party, and integration with attached exhibits are included.

IN WITNESS WHEREOF, the parties have executed this Lease as of the date first written above.

LANDLORD:

____________________________

[Landlord Legal Name]

By: ____________________________

[Landlord Signature]

Name: [Landlord Printed Name]

Title: [Landlord Title]

TENANT:

____________________________

[Tenant Legal Name]

By: ____________________________

[Tenant Signature]

Name: [Tenant Printed Name]

Title: [Tenant Title]

EXHIBIT LIST:

Exhibit A: Floor Plan

Exhibit B: Buildout Schedule

Exhibit C: Operating Rules

Exhibit D: Disclosure Forms

Exhibit E: Guarantee (if applicable)