💡 What to Know Before Signing a Commercial Lease in Arizona

Signing a commercial lease is a big step for any small business—but it’s also one of the most legally binding and financially significant commitments you’ll make.

Whether you're opening a storefront, expanding your medical practice, or leasing office space, commercial leases are full of legal and financial landmines—especially in Arizona, where tenant protections aren’t as broad as those in residential leases.

Here’s what every Arizona business owner should know before signing a commercial lease.

1. Understand the Lease Type

There are several types of commercial leases, and the financial terms vary significantly.

The most common include:

• Gross Lease – You pay one flat monthly rent; landlord covers most costs (taxes, insurance, CAM fees)

• Net Lease (Single, Double, Triple Net) – You pay base rent plus some or all property expenses

• Modified Gross Lease – A hybrid; you share certain costs with the landlord

📌 Triple net leases (NNN) are common in Arizona, especially for retail and healthcare—but they can be expensive if you’re not prepared for variable expenses.

2. Location Isn’t Everything—Zoning and Use Matter Too

Just because a space looks perfect doesn’t mean you can use it the way you want.

Before you sign:

• Confirm the zoning allows your business type (e.g., medical, retail, cannabis, light industrial)

• Check parking requirements and ADA compliance

• Ask about signage restrictions and tenant improvement (TI) approvals

📌 Don’t assume your landlord has verified any of this—you are responsible for checking.

3. Watch Out for “Standard” Lease Terms

Landlords often use templated leases written to favor them, not you.

🚩 Key clauses to watch:

• Personal guarantee – makes you personally liable even if you have an LLC

• CAM (common area maintenance) – vague or open-ended language can spike your rent

• Rent escalation – automatic increases may be tied to CPI, fixed rates, or landlord discretion

• Use and assignment restrictions – may block subleasing or business changes

📌 What’s in the “boilerplate” can cost you thousands—read every line.

4. Build-Out and Tenant Improvements (TIs)

If the space needs work (build-out), clarify:

• Who pays for what

• Timeline for completion

• Who owns improvements once installed

• What happens if your lease ends early

📌 TI allowances are negotiable. Don’t assume what’s “offered” is the best you can get.

5. Understand the Renewal, Expansion, and Exit Terms

What happens when the lease ends—or your business grows?

• Are renewal terms guaranteed or renegotiated?

• Do you have a right of first refusal on adjacent space?

• Can you terminate early, and if so, at what cost?

📌 The more flexibility you have, the easier it is to adapt to future changes.

6. Get Legal Help Before You Sign

A real estate broker can help find space, but only an attorney can:

• Spot legal risks

• Negotiate favorable language

• Help you avoid hidden traps in standard lease language

Even a short lease can have long-term consequences. Review it with legal counsel before signing.

🧠 Final Thoughts

Commercial leases are written to protect landlords—not tenants. If you don’t fully understand the document, you could be locked into a one-sided agreement for years.

Need help reviewing or negotiating your lease? I help Arizona business owners and healthcare professionals secure favorable terms and avoid legal headaches.

Hurley Law Group
Commercial Leasing Counsel for Arizona Businesses and Professionals
📞 308-383-1867
🌐 hurleylawgroup.com
✉️ eric@hurleylawgroup.com