The Letter of Intent to Lease is a crucial preliminary document in German commercial real estate transactions, used when parties have reached initial agreement on key lease terms but need to formalize their intentions before proceeding with a full lease agreement. It serves multiple purposes: documenting preliminary understanding, setting negotiation parameters, and establishing certain binding obligations (such as confidentiality and exclusivity). This document type is particularly important in the German market where lease negotiations can be complex and time-consuming. The Letter of Intent to Lease typically precedes extensive due diligence and detailed lease negotiations, providing a roadmap for the transaction while allowing parties to proceed with confidence that their basic commercial terms are aligned. It's commonly used in commercial, retail, and industrial leasing situations where significant property modifications or substantial lease terms require careful consideration.
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1. Parties: Full legal names and addresses of the prospective landlord and tenant
2. Property Identification: Precise description of the premises to be leased, including address and relevant details
3. Purpose Statement: Clear statement that this is a non-binding Letter of Intent (except for specified provisions)
4. Key Commercial Terms: Basic lease terms including proposed rent, term, and intended use of property
5. Timeline: Expected timeline for negotiation and execution of the final lease agreement
6. Confidentiality: Binding provisions regarding confidentiality of negotiations and shared information
7. Exclusivity: Period during which the landlord will negotiate exclusively with the prospective tenant
8. Closing: Signature blocks and date
1. Due Diligence: Terms regarding the tenant's right to conduct property inspections and review documentation - include when physical inspection or document review is required
2. Deposit Terms: Any preliminary agreement on security deposit or bank guarantee - include when these terms have been discussed
3. Broker Statement: Declaration of any involved real estate brokers and commission arrangements - include when brokers are involved
4. Cost Allocation: Preliminary agreement on who bears which costs - include for complex commercial properties
5. Conditions Precedent: Any conditions that must be met before proceeding with the lease - include when specific prerequisites exist
6. Break Options: Any preliminary agreement on break clauses - include for longer-term lease intentions
1. Floor Plan: Preliminary floor plan or property layout of the intended lease space
2. Commercial Terms Sheet: Detailed breakdown of proposed commercial terms including rent, service charges, and other payments
3. Timeline Schedule: Detailed timeline for due diligence, negotiation, and completion of the final lease
4. Maintenance Responsibility Matrix: Preliminary split of maintenance responsibilities between landlord and tenant
5. Permitted Use Details: Specific details about the intended use of the property and any required permits or licenses
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