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Commercial Lease Agreement Template – Illinois
Document an Illinois commercial lease with clear default, cure, and cost-allocation terms.
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Commercial Lease Agreement Template
Financial Assurances Entry Point.
This Commercial Lease Agreement (the “Agreement”) is made and entered into as of [Date], by and between:
Landlord: [Full Legal Name], having a mailing address of [Address], hereinafter referred to as the “Landlord.”
Tenant: [Full Legal Name], having a mailing address of [Address], hereinafter referred to as the “Tenant.”
The Landlord and the Tenant may each be referred to herein as a “Party” and collectively as the “Parties.”
Security Deposit and Credit Support.
a. Tenant shall pay a security deposit in the amount of [Security Deposit Amount in USD] upon execution of this Agreement or before taking possession.
b. The security deposit may be applied to damages, unpaid rent, unpaid additional rent, or other charges resulting from Tenant’s breach.
c. Additional Security (if any): [Personal guaranty], [Letter of credit], [Other: ____].
Premises and Use Classification.
a. The Landlord leases to Tenant the commercial property (“Premises”) at [Full Property Address and Description (suite number, floor, etc.)].
b. Permitted Use Classification: Category: [Retail / Office / Service / Industrial / Other]. Subtype: [Subtype description].
c. Tenant shall not materially change the use classification without Landlord’s prior written consent.
Term and Possession.
a. The term of this Agreement (“Term”) shall commence on [Commencement Date] and shall expire on [Expiration Date].
b. Holding Over: Possession beyond expiration without written extension is month-to-month on the same terms, except rent shall be [Percentage/Amount] of the then-current rent.
Rent and Payment Terms.
a. Tenant shall pay monthly base rent in the amount of [Rent Amount in USD], due on or before the [Due Date] day of each month, payable by [Payment Method].
b. Late Fee: If base rent is not received within [Grace Period] after the due date, a late fee of [Late Fee Amount or Percentage] may be charged.
c. Proration: Partial month rent shall be prorated on a [30-day month / actual days in month] basis.
Operating Expenses and Utilities.
a. Lease Structure: [Gross / Modified Gross / Net / Triple Net (NNN)].
b. If additional rent applies, Tenant shall pay [Tenant’s Proportionate Share %] of [Taxes / Insurance / CAM] as invoiced pursuant to [Addendum A / this Section].
c. Utilities: Tenant shall arrange and pay for utilities for Tenant’s operations unless otherwise specified.
Maintenance, Repairs, and Improvements.
a. Tenant shall keep the Premises clean and orderly and shall promptly make non-structural repairs necessary due to Tenant’s use or occupancy.
b. Landlord shall be responsible for structural repairs to roof, foundation, and exterior walls, except to the extent damage is caused by Tenant.
c. Alterations require Landlord’s prior written consent and must comply with applicable law and building requirements.
Insurance.
a. Tenant shall maintain commercial general liability insurance with coverage of at least [Minimum Coverage Amount], naming Landlord as an additional insured.
b. If applicable, Landlord may maintain property insurance for the structure, the cost of which may be reimbursed by Tenant as additional rent.
c. Each Party releases the other to the extent of insurance proceeds received for covered property damage losses.
Default, Cure, and Enforcement.
a. Tenant is in default if Tenant fails to pay rent or other charges when due, or breaches a material term and fails to cure within [Cure Period] after written notice.
b. Upon default, Landlord may terminate this Agreement, retake possession, accelerate unpaid sums if permissible, and pursue other remedies at law or in equity.
c. Enforcement Costs: Tenant shall pay Landlord’s legal fees and costs incurred to enforce Tenant’s obligations, to the extent permitted by law.
Casualty and Condemnation.
a. If the Premises are damaged by casualty so it becomes substantially unusable, Landlord shall use available insurance proceeds to repair within a reasonable time.
b. If repairs cannot be completed within [Time Frame], either Party may terminate upon written notice.
c. If all or a substantial part of the Premises is taken by eminent domain such that it cannot be used for Tenant’s purposes, this Agreement shall terminate as of the date of taking.
Notices and General Terms.
a. Governing Law and Venue: This Agreement shall be governed by the laws of the State of Illinois. Any action shall be filed in the state or federal courts located in [County], Illinois.
b. Notices shall be in writing and deemed given when delivered personally, sent by certified or registered mail (return receipt requested), or sent by a recognized courier service to the addresses above (or as updated by notice).
c. Entire Agreement; Severability: This Agreement and any addenda are the entire agreement. Invalid provisions do not affect remaining provisions.
Module 1 - Default Notice and Cure Tracker.
The tracker below forms part of the Agreement.
Issue | Notice Date | Cure Deadline | Cure Method / Proof | Resolved (Y/N) |
[Nonpayment] | [Date] | [Date] | [Proof of payment / receipt ID] | [Y/N] |
[Unauthorized use] | [Date] | [Date] | [Written confirmation / inspection record] | [Y/N] |
[Repair obligation] | [Date] | [Date] | [Invoice / work order ID] | [Y/N] |
[Insurance lapse] | [Date] | [Date] | [COI/endorsement ID] | [Y/N] |
Module 2 - Corrective Actions and Work Orders.
a. Work Orders: Repair or maintenance requests shall be submitted to [Portal/Email/Address].
b. Authorization: Tenant shall not authorize work on building structural elements without Landlord’s prior written approval.
c. Documentation: The Parties may document completed work using [Work order ID], [Invoice ID], and [Completion date].
Module 3 - Two-Step Condition at Surrender.
a. Category: [Cleanliness / Damage / Systems / Fixtures / Other].
b. Severity Scale: [1-Minor], [2-Moderate], [3-Major], with supporting evidence identifiers: [Photo/Video IDs].
c. Any dispute regarding condition at surrender may be evaluated against the categories and evidence identifiers above.
Signatures.
IN WITNESS WHEREOF, the Parties have executed this Commercial Lease Agreement on the dates indicated below.
Landlord: [Landlord Name]
Signature: ______________________________
Name/Title: [Authorized Signatory / Title]
Date: ______________________________
Tenant: [Tenant Name]
Signature: ______________________________
Name/Title: [Authorized Signatory / Title]
Date: ______________________________
Case Owner / Lease Administrator (if any): [Name]
Signature: ______________________________
Date: ______________________________
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Commercial Lease Agreement Template – Illinois
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For quick answers, scroll below to see the FAQ.
Click below for detailed info on the template.
For quick answers, scroll below to see the FAQ.
Illinois Commercial Lease Agreement Template FAQ
Why does an Illinois commercial lease often focus on security deposit and additional security?
From a practical perspective, security is what makes the landlord comfortable delivering possession and extending credit over the term. If the tenant is new or the buildout is significant, the parties may use a deposit plus another form of security like a guaranty or letter of credit. The lease should state when security is due, what it can be applied to, and whether it must be replenished after use. Clear security terms also help tenants understand what behavior can lead to deductions and how to avoid them.
How does a cure period protect both parties in a commercial lease?
A cure period creates a predictable window to fix a problem after notice instead of immediately escalating to termination. For tenants, it reduces the risk of losing the space due to a correctable mistake like a late payment or a compliance issue. For landlords, it creates a formal record and a timeline that supports enforcement if the issue is not resolved. The lease should clearly define when the cure clock starts and what evidence counts as a cure.
What is the purpose of a default notice tracker in a lease template?
Tracking notices helps prevent arguments about whether a notice was sent, when it was received, and whether a cure deadline passed. A simple tracker can also make internal administration easier for property managers and tenant operators. If a dispute arises, the parties can point to documented dates and proof of cure rather than reconstructing events later. Even if the tracker is never used, having it in the template encourages better recordkeeping during stressful moments.
How should the permitted use be written if the tenant's business may evolve?
One approach is to define a broad category with a specific subtype, then require consent only for a material change in category. That structure lets the tenant adapt within the category while giving the landlord control over major changes that could affect other tenants or building systems. The lease should still exclude any clearly unacceptable activities, such as hazardous storage or high-impact operations, if those would be a problem for the property. A clear use definition reduces disputes and helps with insurance placement.
When is a net lease expense clause most likely to cause conflict?
Conflicts usually occur when the categories are vague, the allocation method is unclear, or reconciliations happen late. To reduce friction, the lease should state what costs are included, how the tenant share is calculated, when estimates are billed, and when the true-up occurs. It also helps to state how supporting records are maintained and for how long. Predictable billing rules matter because they directly affect the tenant's real occupancy cost.
Do legal fee clauses automatically mean the landlord can recover everything?
A fee clause sets expectations about cost shifting, but enforcement depends on the wording and what is permitted in the forum where the dispute is handled. To keep it fair and predictable, many parties tie fees to enforcement of the lease and require the fees to be reasonable. The lease can also specify whether fees include collection costs, court costs, or other expenses. If fees are a concern, it is best to negotiate the scope before signing rather than after a dispute starts.
What should happen to fixtures and improvements at the end of the term?
The lease should say which items are tenant trade fixtures, which become part of the premises, and what must be removed. It should also address repair obligations after removal, such as patching holes or restoring finishes. A structured surrender description, including categories and evidence identifiers, makes move-out smoother. Clear rules reduce the risk that the tenant removes something the landlord expected to keep or leaves behind items that create disposal costs.
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