The Lease Option Agreement serves as a crucial legal instrument in the UAE real estate market, combining the immediate need for property occupation with a future purchase opportunity. This document type is particularly relevant in the UAE's dynamic property market, where businesses and individuals often seek flexibility in their property arrangements. The agreement must comply with UAE federal laws, including the Civil Code and Commercial Transactions Law, as well as specific emirate-level regulations such as Dubai Law No. 26 of 2007 or Abu Dhabi Law No. 20 of 2006. The Lease Option Agreement includes detailed provisions for both the lease period and the purchase option, making it suitable for various commercial and residential scenarios. It's commonly used when potential buyers want to secure a property's purchase price while having time to arrange financing or assess the property's suitability for their needs.

1. Parties: Identification of the lessor/option grantor and lessee/option holder, including full legal names, addresses, and registration details if companies

2. Background: Context of the agreement, including property ownership confirmation and parties' intentions regarding lease and future purchase option

3. Definitions: Definitions of key terms used throughout the agreement, including Property, Option Period, Purchase Price, and Exercise Notice

4. Lease Terms: Core lease provisions including rent amount, payment terms, duration, and renewal conditions

5. Option Grant: Explicit grant of the option to purchase, including the option period and conditions for exercise

6. Option Price and Payment: Purchase price for the property if option is exercised, including any credit for rent paid

7. Exercise of Option: Procedure for exercising the option, including notice requirements and timeframes

8. Property Maintenance and Repairs: Responsibilities for property maintenance during the lease period

9. Insurance and Risk: Insurance requirements and allocation of risk during the lease period

10. Default and Remedies: Consequences of default under either the lease or option provisions

11. Representations and Warranties: Standard representations regarding property ownership, authority to contract, and property condition

12. Governing Law and Jurisdiction: Specification of UAE law application and jurisdiction for disputes

13. Notices: Process for serving formal notices under the agreement

14. General Provisions: Standard boilerplate clauses including entire agreement, amendments, and severability