Agreement to Lease
An Agreement to Lease is a binding pre-lease agreement, setting the conditions for completing the lease.
(0 reviews)
Last updated December 17, 2024
Under 10 minutes
Suitable for Australia
Written by
Edwin Montoya Zorrilla
Reviewed by
Damin Murdock
Document Overview
An agreement to lease is a separate deed to the lease. It is entered into when one or more critical terms of the lease (such as the construction of premises or some other issue like development approval) cannot be established at the time the lease is signed.
Note that this agreement to lease is a bare bones precedent. It does not contain complex provisions about construction timetables (where the premises are yet to be built) or sunset dates. Where these are required you will need to think very carefully about what is required and the time frames.
This agreement assumes that there will be a guarantor who will guarantee the performance of the tenant's obligations under this agreement?
This agreement must be signed as a deed to the effective.
An agreement to lease should have a lease attached to it that will take effect once the precondition(s) in the agreement for lease have been met. The agreement to lease will have an authorisation clause for the landlord to complete things such as start dates etc.
The Legal Risk Score of a Agreement to Lease Template
Our legal team have marked this document as medium risk considering:
- The document mandates the Tenant to bear all legal costs related to the negotiation, preparation, execution, and any potential defaults under the agreement, which could result in significant financial obligations for the Tenant.
- All consents required by the Tenant for alterations or other actions need written approval from the Landlord, and the Tenant must cover all associated costs, potentially leading to delays and additional expenses.
- The document does not explicitly provide an exit or modification clause for the Tenant, which means the Tenant might find it challenging to adapt or exit the agreement without facing substantial legal and financial repercussions.
Overall, this document places a considerable amount of financial and operational responsibility on the Tenant. Users familiar with such documents might understand the implications, but should remain cautious about the potential for incurring unexpected costs and the limited flexibility in terms of modifying the agreement.
Agreement to Lease Checklist
Complete your free Agreement to Lease with our checklist
Ensure Proper Execution of the Lease
Make sure all parties have signed the lease and that it is held in escrow until the Commencement Date as stipulated.
Send Signed Copies to Landlord
After signing, promptly deliver all copies of the executed lease to the Landlord to ensure legal effectiveness from the Commencement Date.
Monitor Commencement Date
Keep track of the Commencement Date to ensure that the lease takes effect as planned and all conditions are met for a smooth transition.
What does the Agreement to Lease cover?
- Both parties' obligations until the lease commences.
- The nature of the guarantee.
- The legal costs of preparing thel lease, which the tenant will cover
- General terms and conditions including dispute resolution.
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