Workshop, factory, barn lease

About this workshop lease

This comprehensive lease is for letting a stand-alone workshop, factory, warehouse or light industrial unit which does not share services with any other unit. The building could be used for anything: from a car repair garage to a machining workshop to an aircraft hangar.

This is a professionally drawn, very comprehensive lease with massive legal protection for the landlord including a long menu of “do’s” and “don’ts”.

This lease is not a compromise between the interests of the parties. It prefers the landlord’s interest. We think that is the best start point. If you wish to make concessions to your tenant, that is fine, but we want you have those choices.

It includes service charge provisions to provide 100% recovery of service costs.

Similar lease agreements

There is no provision for service charge recovery in this document. If you need this, perhaps because the unit shares services with others or is part of an industrial estate, see Business lease: unit on industrial estate.

If the property will be used as offices, Self contained office lease agreement may be more appropriate.

If the property is mainly land, with plant or buildings, Business lease: land, vacant or with plant or buildings may be more appropriate.

Key features

Plain English is used throughout except where it is necessary to use legal terms common in this field of law.

The key features of this template can be summarised as:

• standard guarantor
• options for transfer or assignment to another party
• sub-letting forbidden
• option to include a break clause for premature termination by the tenant
• a choice of options for rent reviews

This document has been drawn so as to make it applicable to the vast majority of leasing scenarios without making it difficult to edit.

The law in this workshop lease

Commercial leases differ significantly from residential leases. Residential leases are highly regulated. In contrast, commercial leases are governed chiefly by common law and are very loosely regulated. The rights and obligations of the landlord and tenant are mainly a matter of agreement between the parties. There are no statutory requirements to register your lease, but either party may register a lease of three years or more.

Lease template contents

This workshop lease is comprehensive, providing alternative choices for important decisions.

The contents include 25 provisions and 1 schedule covering:

• rent: period, amount, other payments, interest on overdue rent, periodic review
• condition and repair
• tenant's positive obligations
• restrictions on tenant: prohibited activities on the property
• signs and advertisements
• goods and vehicles
• assignment of the lease
• indemnities by the tenant
• security deposit
• insurance
• access for landlord
• guarantor
• termination: default notice by landlord; provision for premature termination (a break clause)
• forfeiture

Schedule 1: rights reserved