An Offer to Lease is a document a prospective tenant uses to offer to rent a commercial property from a landlord or property manager. In other words, it’s an official offer to enter a Commercial Lease Agreement

It outlines some basic lease terms negotiated by the landlord and tenant, such as the lease length, rent amount, and security deposit. 

Prospective tenants may use an Offer to Lease when attempting to rent business properties, such as:

• Offices
• Buildings
• Retail spaces
• Restaurant spaces
• Industrial spaces
• Warehouses

An Offer to Lease is also known as a lease offer letter or a lease proposal.

Here’s a breakdown of the process you may experience when securing a commercial rental property, including how an Offer to Lease works with other important rental documents

1. A prospective tenant applies to rent a commercial rental property.
2. The landlord chooses the applicant as a viable tenant option.
3. The landlord and tenant may negotiate the lease terms (e.g., debate a fair rent price).
4. The tenant creates and signs an Offer to Lease, outlining the agreed-upon lease terms, and gives it to the landlord.
5. If the landlord accepts and signs, the offer constitutes a binding agreement between the parties.

The landlord and tenant use a Commercial Lease Agreement to outline the exact tenancy details.

Yes, when signed by both parties, an Offer to Lease is usually a legally binding contract.

Unless you modify the exact terms of your Offer to Lease, our template creates an irrevocable offer. However, it does prompt you to provide a date on which the offer expires. Therefore, the offer is irrevocable until this expiry date.

It only becomes null and void if the landlord does not accept the offer and the expiry date passes.

If the landlord accepts the offer before the expiry date, then the offer constitutes a binding agreement between the parties. In that sense, once the tenant has signed the Offer to Lease and given it to the landlord, they could be bound to their offer. Once the landlord accepts and signs the offer, it constitutes a binding agreement.

If you want to create a revocable Offer to Lease, use our editor tool to modify the exact wording of your document, ensuring you remove “irrevocable.”

Although these are both legal documents used when securing a rental property, they’re distinct from one another. Let’s discuss two key differences.

1. An Offer to Lease comes before a Commercial Lease Agreement. It’s a preliminary agreement. So, you don't need the Offer to Lease if you’ve already created a Commercial Lease Agreement.
2. A Commercial Lease Agreement includes more detail than an Offer to Lease, including terms regarding parking, late payment penalties, and more. Generally, an Offer to Lease only contains basic lease information, such as the lease term, rent amount, and security deposit. 

Of course, an Offer to Lease and a Commercial Lease Agreement are similar in some ways. They’re both documents that govern commercial tenancies. Also, when signed by all parties, they’re both binding agreements.

In order for an Offer to Lease to serve its purpose, it should include some key details. Our template asks you to include information about the:

• Tenant, such as the individual or organization’s name and address
• Landlord, such as the individual or organization’s name and address
• Property, including the address and permitted use of the property
• Lease term, including a start date and term length, which can also include a move-in date prior to the start date
• Rent, including the rent amount, how it’s calculated, what costs are included, and how taxes are paid
• Security deposit, including whether the tenant will prepay any rent or provide a deposit
• Expiry date

In addition, you can also specify whether the lease is subject to approval by the tenant’s attorney.