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Commercial Tenancy Agreement for Philippines

Commercial Tenancy Agreement Template for Philippines

A comprehensive legal document governed by Philippine law that establishes the terms and conditions for leasing commercial property between a lessor (property owner) and a lessee (business tenant). The agreement complies with the Civil Code of the Philippines and relevant local government regulations, covering essential aspects such as rent, duration, maintenance responsibilities, and operational requirements. It includes specific provisions for commercial use, incorporating Philippine business practices and local commercial property regulations while protecting both parties' interests under Philippine jurisdiction.

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What is a Commercial Tenancy Agreement?

The Commercial Tenancy Agreement is a vital legal instrument used in the Philippines when a property owner (lessor) agrees to lease commercial space to a business tenant (lessee). This document, governed by Philippine law including the Civil Code and Local Government Code, is essential for establishing clear terms in commercial property relationships. It covers crucial elements such as rental terms, property use restrictions, maintenance obligations, and compliance requirements with local regulations. The agreement is particularly important in the Philippine context where commercial property relationships must navigate both national and local government requirements. It serves as a comprehensive framework for managing commercial lease arrangements while ensuring compliance with Philippine business practices and property laws.

What sections should be included in a Commercial Tenancy Agreement?

1. Parties: Identification of the Lessor and Lessee with complete legal names and addresses

2. Background: Context of the agreement and brief description of the premises and intended use

3. Definitions: Definitions of key terms used throughout the agreement

4. Demise: The formal granting of the lease and specification of the premises

5. Term: Duration of the lease, commencement date, and expiry date

6. Rent and Other Payments: Rental amount, payment schedule, security deposit, advance rent, and other financial obligations

7. Use of Premises: Permitted use of the premises and any restrictions

8. Maintenance and Repairs: Responsibilities of both parties regarding maintenance, repairs, and improvements

9. Utilities and Services: Provisions regarding utility connections, payments, and building services

10. Insurance: Required insurance coverage for both parties

11. Assignment and Subletting: Terms governing the transfer of lease rights or subletting

12. Lessor's Covenants: Obligations and warranties of the property owner

13. Lessee's Covenants: Obligations and warranties of the tenant

14. Default and Remedies: Events of default and corresponding remedies

15. Termination: Conditions and procedures for lease termination

16. Governing Law: Specification of Philippine law as governing law

17. Dispute Resolution: Procedures for resolving disputes

18. Notices: Method and addresses for formal communications

19. General Provisions: Miscellaneous legal provisions including severability, entire agreement, and amendments

What sections are optional to include in a Commercial Tenancy Agreement?

1. Fit-out Period: Terms for initial renovation period, used when premises require tenant improvements

2. Operating Hours: Specific provisions about business hours, needed for mall locations or multi-tenant buildings

3. Common Areas: Rules for shared facilities, needed in multi-tenant properties

4. Signage Rights: Terms for external and internal signage, important for retail premises

5. Environmental Compliance: Special environmental obligations, needed for industrial or manufacturing use

6. Force Majeure: Provisions for unforeseen circumstances, particularly relevant post-COVID

7. Option to Renew: Terms for lease renewal, included when agreed by parties

8. Right of First Refusal: Tenant's right to match purchase offers, included when negotiated

9. Exclusivity Clause: Restrictions on competing businesses, relevant for retail locations

What schedules should be included in a Commercial Tenancy Agreement?

1. Schedule 1 - Property Details: Detailed description of premises including floor plans and measurements

2. Schedule 2 - Rent Schedule: Detailed breakdown of rent, escalation rates, and payment terms

3. Schedule 3 - Condition Report: Documentation of premises condition at commencement

4. Schedule 4 - House Rules: Building rules and regulations

5. Schedule 5 - Fit-out Guidelines: Technical specifications for tenant improvements

6. Schedule 6 - Service Charges: Breakdown of additional charges and building services

7. Schedule 7 - Handover Inventory: List of fixtures and fittings included in the lease

8. Appendix A - Required Permits: List of necessary government permits and licenses

9. Appendix B - Insurance Requirements: Detailed insurance specifications

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Philippines

Document Type

Tenancy Agreement

Cost

Free to use

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