An office lease looks simpler than a restaurant or medical lease, and that is exactly why its costs hide in plain sight: the square footage you pay for is not the square footage you use, the operating-expense base year quietly resets your share each renewal, and the sublease clause decides whether you can shed space when you grow or shrink. For the dollar math, see the office and coworking exposure scenarios; for general terms, the commercial lease checklist.
This is an observational checklist. Each item names what to find in your lease and why it matters — it does not tell you what to decide. Confirm what your document actually says for each point, and treat any protection that is simply absent as information about where your exposure sits. The legal judgment about what to do with what you find is yours.
1. The Space and Measurement Terms
What you pay for is not always what you occupy.
- Usable vs rentable square footage. Confirm both figures and the load factor (the share of common areas added to your usable space). Rent is charged on rentable square footage, which can run 10–20% above what you actually occupy.
- Parking ratio and cost. Find the number of parking spaces included, the ratio per 1,000 square feet, and whether parking is bundled or billed separately.
- Building hours and after-hours HVAC. Confirm standard building hours and the per-hour charge for heating and cooling outside them, which adds up for teams that work late.
- Expansion and right of first refusal. Find whether you have any right to take adjacent space or first refusal on it, which matters if you expect to grow.
2. The Money Terms
The expense structure, not just the rent, sets your real cost.
- Lease structure and base year. Confirm whether the lease is full-service/gross or net (NNN), and the operating-expense base year against which your share of increases is measured. A reset base year at renewal can quietly raise costs. The CAM charges calculator helps estimate pass-throughs.
- Operating-expense pass-throughs and caps. Find your pro-rata share of operating-expense increases and whether annual increases are capped.
- Rent escalation, free rent, and TI. Confirm the annual increase, any free-rent period, and the tenant improvement allowance for fit-out.
3. The Flexibility and Exit Terms
Office needs change with headcount, so exit flexibility is central.
- Sublease and assignment rights. Confirm whether you can sublease or assign, and whether the landlord can recapture the space or withhold consent. Offices change size often, so this is the main lever for shedding space.
- Early termination. Find whether any early-termination right exists and at what cost. The early termination calculator estimates the exposure.
- Renewal options and holdover. Confirm renewal terms and notice deadlines, and the holdover rent if you stay past the end date.
4. The Liability Terms
These decide whose assets are on the line.
- Personal guaranty. Confirm whether you are personally guaranteeing the lease and whether it is capped. An unlimited personal guaranty puts your own assets behind the full remaining lease value; negotiated leases commonly include a cap, time limit, or burn-off. The personal guaranty calculator sizes the exposure.
- Insurance and restoration. Confirm the required coverage and the condition the lease requires the space to be returned in, including removal of any fit-out. The restoration cost estimator gives a range.
5. The Dispute Terms
These decide the outcome if the relationship goes wrong.
- Default, cure, and landlord mitigation. Confirm how default is defined, the cure period, and whether the landlord must make reasonable efforts to re-let after a default.
- Attorney fees, jury waiver, and venue. Confirm whether fee-shifting is one-way or mutual, whether you are waiving a jury trial, and which state’s law governs.
How to use the result: Mark every item you cannot answer from the lease text. The unanswered items are your shortlist for questions, negotiation, or counsel review — and a missing protection is itself a finding, not a blank to ignore. Related reading: law office and office downsizing exposure, professional services lease risk, and the personal guaranty guide.
Frequently Asked Questions
What should I check in an office lease before signing?
Confirm the usable versus rentable square footage and load factor, the operating-expense structure and base year, parking, after-hours HVAC charges, sublease and assignment rights, any early-termination right, renewal terms, the personal guaranty, and restoration obligations. The costs that surprise office tenants are usually the load factor, the base-year reset, and after-hours HVAC, none of which show up in the base rent.
What is the difference between usable and rentable square footage?
Usable square footage is the space your team actually occupies. Rentable square footage adds your share of common areas (lobbies, hallways, restrooms) via a load factor, and rent is charged on the rentable figure. The load factor commonly adds 10 to 20 percent, so confirm both numbers before comparing offers.
Why does the operating-expense base year matter?
In a full-service lease, you pay your share of operating-expense increases above a base year. If the base year resets to a higher figure at renewal, or is set artificially low, your pass-through costs rise. Confirm the base year and how increases are calculated and capped.
Can I sublease office space I no longer need?
Only if the lease allows it. Sublease and assignment clauses vary widely, and many let the landlord recapture the space or withhold consent. Because office needs change with headcount, the sublease clause is often the most important exit lever in the lease.
Should an office lease be reviewed by an attorney?
Office leases at meaningful dollar exposure or with a personal guaranty are commonly reviewed by counsel before signing. A checklist and an automated scan can tell you where the exposure sits; the legal judgment about what to do with that information is yours.