Commercial Land Lease Agreement for Malaysia

Commercial Land Lease Agreement Template for Malaysia

A Commercial Land Lease Agreement under Malaysian law is a legally binding document that establishes the terms and conditions for leasing commercial land property between a lessor and lessee. The agreement is governed by Malaysian law, particularly the National Land Code 1965, and includes detailed provisions for rent, tenure, permitted use, maintenance obligations, and other essential terms. This document ensures compliance with local property laws while protecting the interests of both parties in a commercial land leasing arrangement. It includes specific provisions required under Malaysian jurisdiction regarding land use, development restrictions, and statutory compliance requirements.

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What is a Commercial Land Lease Agreement?

The Commercial Land Lease Agreement is a crucial document used in Malaysian commercial real estate transactions when a property owner (lessor) wishes to lease land to a business entity (lessee) for commercial purposes. This agreement is essential for establishing the legal framework of the leasing arrangement, ensuring compliance with Malaysian property laws, particularly the National Land Code 1965 and relevant state land rules. It outlines key commercial terms including rent, duration, permitted use, and maintenance responsibilities, while incorporating necessary provisions for security deposits, insurance requirements, and statutory compliance. The document is particularly important in Malaysia's dynamic commercial property market, where proper documentation of land lease arrangements is crucial for legal certainty and protection of both parties' interests.

What sections should be included in a Commercial Land Lease Agreement?

1. Parties: Identification of the lessor and lessee, including registration numbers for companies or NRIC for individuals

2. Background: Context of the lease arrangement and brief description of the property

3. Definitions: Definitions of key terms used throughout the agreement

4. Demise: Details of the property being leased and the grant of lease

5. Term and Renewal: Duration of the lease and any renewal options

6. Rent and Payment Terms: Rental amount, payment schedule, and review mechanisms

7. Security Deposit: Amount, payment terms, and conditions for return of the security deposit

8. Permitted Use: Specified commercial purposes for which the property may be used

9. Maintenance and Repairs: Responsibilities of both parties regarding property maintenance

10. Insurance: Required insurance coverage and responsibilities

11. Utilities and Outgoings: Responsibility for utility payments and other ongoing costs

12. Lessor's Covenants: Obligations and warranties of the property owner

13. Lessee's Covenants: Obligations and warranties of the tenant

14. Termination: Grounds and procedures for early termination

15. Assignment and Subletting: Conditions under which the lease may be assigned or the property sublet

16. Governing Law: Specification of Malaysian law as governing law

17. Dispute Resolution: Procedures for resolving disputes between parties

What sections are optional to include in a Commercial Land Lease Agreement?

1. Fit-Out Works: Used when the tenant is permitted to conduct renovation or fitting out works, specifying conditions and requirements

2. Option to Purchase: Included when the lessor grants the lessee an option to purchase the property during the lease term

3. Break Clause: Used when parties agree to include an early termination option under specific circumstances

4. Green Lease Provisions: Environmental and sustainability requirements, included for green buildings or when parties have specific environmental commitments

5. Force Majeure: Included to address unforeseen circumstances preventing performance of obligations

6. Quiet Enjoyment: Additional provisions regarding tenant's right to peaceful occupation

7. Management Rules: Included for properties within managed complexes or buildings

What schedules should be included in a Commercial Land Lease Agreement?

1. Property Description: Detailed description of the property including lot number, address, and land area

2. Plan of Property: Floor plans, site plans, and location maps

3. Rent Schedule: Detailed breakdown of rent payments, including any progressive increases

4. Condition Report: Detailed description of property condition at commencement of lease

5. Permitted Alterations: Specifications of allowed modifications or improvements

6. Building Rules and Regulations: If applicable, rules governing the use of the building or complex

7. Form of Bank Guarantee: Standard format for bank guarantee if required as security

8. Service Charges: Breakdown of service charges and maintenance fees if applicable

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Malaysia

Publisher

Genie AI

Document Type

Rental Agreement

Cost

Free to use
Relevant Industries

Real Estate

Retail

Manufacturing

Hospitality

Healthcare

Education

Professional Services

Logistics

Warehousing

Technology

Banking and Financial Services

Food and Beverage

Relevant Teams

Legal

Real Estate

Facilities Management

Finance

Operations

Risk and Compliance

Corporate Services

Business Development

Property Management

Asset Management

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Property Manager

Facilities Manager

Real Estate Director

Legal Counsel

Commercial Director

Operations Manager

Risk Manager

Compliance Officer

Finance Manager

Business Development Manager

Asset Manager

Property Development Manager

Corporate Services Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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