LEASE TERM

Typical lease length

Space under 1,500 sq. ft. – 1 to 3 year term plus an option to renew for a term equal or more than the original term
Space over 1,500 sq. ft. – 3 to 5 year term plus an option to renew for a term equal or more than the original term

Rents quoted in

AED/sq. ft./annum on net lettable area. May include service charges.

Break options

Landlords will usually require a break clause to be supported by a 3 to 6 months’ notice accompanied by a period 3 to 6 month penalty.

 

LETTABLE AREA REPAIR RESPONSIBILITY

Internal

Tenant, in case of minor repairs ranging between AED 500-2,000. Usually a predetermined amount mentioned in the contract. In case of major repairs such as structural or MEP, it comes under the landlord.

Common areas

Landlord
Service charges usually included in rent.

External/Structural

Landlord/Owners Association pays for the repairs to the structure, roof etc. and does not pass the charges onto the tenant.

 

OPERATING EXPENSES

Service charges typically cover

• Service charges in a Class A building range from AED 25-30 AED/sq. ft./ annum
• In the case of a strata title office, the service charges are usually paid by the landlord while in the case of a single landlord office, the rent and service charges are segregated, and the tenant pays both

Additional costs that the tenant pays

• The tenant may choose a legal consultant.
• Utility connection and consumption/ services, for example IT.

 

RENTAL PAYMENTS

Frequency of rent payable

Usually annual but can vary from 1-4 payments over the year.

Basis of rent

Rent normally escalates annually in line with CPI. In case of a renewal, rent is escalated in line with the governing authorities rental index regulations

Frequency of rent review

Usually at the end of contract term.

 

SPACE MEASUREMENT

Standard

The area quoted is known as net lettable area. This comprises net area excluding walls, structural columns and common areas.

Efficiency

Usually above 75%.

 

TENANT'S FIT-OUT

Construction

The tenant usually undertakes the fit-out with their contractors and construction workers supervised by the tenant’s architect and approved by the local regulatory body.

Fit-out allowances

Some landlords provide fit- out allowances or rent-free periods and they range anywhere between 2-6 months depending upon the term of the lease

Office Space Calculator

Use the CORE Office Space Calculator to calculate how much office space you will require.

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