Amendment to Office Lease Agreement
(Base Rent Concession, Extension of Lease Term)

Summary

This amendment to office lease agreement template may be used to amend an existing office lease to provide for a mid-term free rent period and an extension of the lease term. This template contains practical guidance, drafting notes, and alternate and optional clauses. Commercial landlords commonly grant rent concessions at the start of a lease term in order to attract tenants and stay competitive. This template, however, provides for a rent concession mid-term. If a tenant anticipates that it will have cash flow issues resulting from business interruption or otherwise, it should consider proactively requesting a rent concession to avoid delinquency or default under its lease. If the landlord is amenable to granting a rent concession, the landlord should require an extension of the lease term for a period of time equal to the free rent period. This allows the landlord to receive the benefit of the term and the rental income negotiated at the time of lease execution, while giving the tenant relief and flexibility when needed. The rent concession and term extension should be memorialized in a lease amendment or a letter agreement executed by both parties. If the parties are not in a position to extend the term, the landlord may consider deferring the tenant's obligation to pay base rent for a specified period of time and requiring payment of the deferred amount prior to an agreed-upon deadline during the existing term. Note that the concession in this template covers base rent only. If your tenant client is facing severe cash flow problems and is in need of more extensive relief, you should push for a concession of base rent and additional rent, which would include your client's share of operating expenses, taxes, electricity, and other rental items that your client is otherwise responsible for paying under its lease. This template may be used by either party and contains drafting notes, an alternate clause, and optional clauses that should be consulted when negotiating. Conform the capitalized terms and section references used in this template to the relevant lease and lease amendment. For further guidance on negotiating rent concessions and abatements on behalf of your tenant client, see Rent Abatement Clauses (Commercial Lease) (Pro-Tenant). For additional information on lease extensions and commercial leases generally, see Office Leasing Resource Kit.