Signing commercial Lease with Tenant before closing

2 Replies

Hi, Im currently under contract to purchase a vacant single tenant commercial building that is set to close in April of this year. I went ahead and had my leasing agent reach out to some national tenants while in due diligence to get a a understanding of the demand for the location and received a Loi that I have already worked thru with tenant and executed. They would like to move to lease negotiations now and I’m wondering if I’m even able to execute a lease while still under contract because essentially I don’t own the premises at the present time. Any insight is appreciated. Thanks!

Sure. You just have to either have the signed lease held in escrow pending acquisition of the property, or put a clause right in it that the lease is contingent upon taking title.

Originally posted by @Jessica Zolotorofe :

Sure. You just have to either have the signed lease held in escrow pending acquisition of the property, or put a clause right in it that the lease is contingent upon taking title.

That’s what I was told by my leasing agent but wanted to be sure.  Thank you Jessica!