Renting a business as an owner: what you need to know

Why rent commercial premises?

There are multiple advantages to renting commercial premises. To begin with, the commercial real estate market is quite lucrative. Indeed, it generates a return of 5 to 10%, up to twice as much as residential real estate.

Moreover, commercial tenants are generally more reliable, which means that the owner can count, in principle, on regular rents. Note also that for this type of real estate, rental vacancies are rarer. You can therefore benefit from a more constant flow of income.

What type of lease for commercial premises?

When a part or the totality of a building is mainly allocated to the operation of a retail business or to the activity of a craftsman directly in contact with the public, then the lease in force is the commercial lease. This must obligatorily be registered in a legal security office competent for the place where the commercial building to rent is located.

What is a commercial lease?

It is a contract signed between the owner and the tenant, which defines the main rules for renting commercial premises.

Note that the commercial lease is highly regulated. Belgian legislation notably defines:

• the legal durations,
• the termination conditions,
• and the obligations of the parties.

This strong regulation offers more security to owners.

The duration of a commercial lease

In principle, the duration of a commercial lease cannot be less than 9 years. The tenant has the right to 3 renewals. These renewals must be requested by registered letter between the 18th and 15th month preceding the expiration of the lease.

Note however that short-term or long-term commercial leases can also be concluded:

• for a period equal to or less than one year, as this allows pop-up stores to develop.
• for a period exceeding 9 years, on condition that the agreement is recorded by authentic deed passed before a notary.

Termination of the commercial lease: is it possible?

Although the legal duration of a commercial lease is 9 years, the parties can decide to terminate the contract before term. This is called early termination.

But be careful, this is only possible when the agreement of the parties on this termination has been the subject of:

• a notarial deed,
• a judgment,
• or a declaration made before a judge.

In this way, there is no longer any doubt as to the actual date of the parties’ agreement on the early termination of the lease.

In conclusion

Renting commercial premises can be very advantageous for owners. But to take advantage of all the benefits that such a rental offers, it is still necessary to call upon a professional real estate expert in Belgium. With its many years of experience, Allten is able to support you from A to Z in your project. Do not hesitate to contact us to learn more.