Before You Sign: Why a Lawyer Should Review Your Lease Agreement in Alberta
Signing a lease is one of the most significant legal commitments a business will make. Whether you are leasing office space, retail premises, or industrial property, the terms of your lease can affect your costs, flexibility, and legal risk for years to come.
Many Alberta business owners sign lease agreements without legal review, assuming the document is standard or non-negotiable. In reality, commercial leases often heavily favour landlords and contain provisions that can expose tenants to unexpected liability.
This article explains why having a lawyer review your lease agreement is critical, what risks commonly appear in Alberta leases, and how legal advice can protect your business before you commit.
Commercial Leases Are Not Standard Agreements
Unlike residential leases, commercial lease agreements are largely negotiable. There is no single “standard” form, and landlords often draft leases to protect their own interests.
Key terms can vary significantly between leases, including:
- Rent escalation and additional rent
- Maintenance and repair obligations
- Assignment and subleasing rights
- Termination and renewal options
Once signed, these terms are difficult—and sometimes impossible—to change.
Common Clauses That Create Risk for Tenants
Commercial leases frequently include provisions that deserve careful legal scrutiny, such as:
- Broad repair and maintenance obligations
- Personal guarantees by directors or shareholders
- Automatic rent increases or operating cost pass-throughs
- Restrictions on use that limit business growth
These clauses can significantly increase long-term costs or limit your ability to adapt your business.
Personal Guarantees and Business Owners
Many landlords require personal guarantees, particularly for small or growing businesses. A personal guarantee can:
- Expose personal assets to business liabilities
- Survive assignment or sale of the business
- Continue even after the lease term ends
Understanding the scope and duration of a guarantee is essential before agreeing to it.
How Lease Terms Affect the Sale of Your Business
Lease terms can directly affect your ability to sell your business. Restrictions on assignment or landlord consent requirements may:
- Delay a sale
- Reduce the pool of potential buyers
- Affect the value of the business
For business owners considering future growth or exit, lease review should be part of broader planning. You may also find it helpful to understand why your business needs a shareholders’ agreement, as these documents often work together to protect long-term interests.
The Cost of Not Getting Legal Advice
Problems caused by poorly reviewed leases often arise years later, when:
- Repair disputes occur
- Rent increases exceed expectations
- The business needs to relocate or expand
- The lease must be assigned or terminated
At that point, the cost of legal disputes often far exceeds the cost of upfront legal review.
How a Lawyer Can Help
A business lawyer can:
- Identify unfair or risky clauses
- Explain your obligations in plain language
- Negotiate revisions where possible
- Align lease terms with your business goals
Legal review helps ensure you understand exactly what you are agreeing to—and what risks you are taking on.
Learn more about how Libra Law assists business owners through its business law services in Alberta. You can also explore related topics in Libra Law’s business law articles.
Protect Your Business Before You Sign
A commercial lease is not just paperwork—it is a long-term legal commitment that can shape your business’s success or failure.
The Business Law team at Libra Law provides clear, practical advice to Alberta business owners entering or renegotiating lease agreements. You can contact our firm to discuss reviewing your lease agreement and move forward with confidence.
This article is for general informational purposes only and does not constitute legal advice. To obtain advice specific to your situation, please consult a lawyer or qualified professional.
