Part 6*: What is the significance of the “commencement date” in a commercial lease?

While the lease commencement date is often a simple matter, in some cases, it may be more complicated. For example, if an existing Tenant must vacate before the Landlord can deliver possession to a new Tenant, that may need to be addressed in the lease. The commencement date may also be conditioned upon the Landlord substantially completing Landlord’s Work, clearing open permits and violations, delivering an ACP-5 or delivering a subordination and non-disturbance agreement from a superior lienholder.

The lease commencement date may be an important issue for one or both parties. For example, the Tenant may have strict requirements for when it needs to open its business (i.e. a retail tenant before the holidays or an educational tenant before the school year begins). A Landlord may need the lease to commence immediately if the Premises is vacant and Landlord has offered a lower rent in exchange for immediate possession.

While the brokers typically discuss the commencement date in general terms the Letter of Intent is not always sufficiently detailed. Therefore, the attorneys may need to further negotiate this fine point.

*Thank you for taking the time to read this article. This article is part of our “Commercial Leasing for Non-Lawyers,” a Blog Series on Commercial Leasing. Other aspects of commercial leasing transactions in New York are discussed in other Parts of this series.

For questions about residential real estate law, or general information about our firm, please contact us at (914) 338-8050 or send an e-mail to We look forward to hearing from you.

Betensky Law PLLC
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(914) 338-8050

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