If you want to lease or buy a commercial property, you may need to write a letter of intent to express your interest and outline the basic terms of the deal. In this article, we will provide you with seven different samples of letters of intent for commercial real estate that you can use as a template and modify according to your needs.
Before we dive into the examples, let’s clarify what a letter of intent is and how it can help you in your real estate transaction.
Explanation
A letter of intent is a non-binding document that sets out the parties’ preliminary understanding of the key terms and conditions of a proposed transaction. It is usually the first step in the negotiation process and serves as a roadmap for the parties to work towards a final agreement. In the context of commercial real estate, a letter of intent can help you:
- Communicate your interest in the property to the landlord or seller
- Establish the basic terms of the lease or purchase
- Clarify any contingencies or conditions that need to be satisfied before the deal can be closed
- Reduce the risk of misunderstandings or disputes
You can find many different templates and examples of letters of intent online, but it is important to tailor your letter to your specific situation and the property you are interested in.
Examples
Letter of Intent to Lease Commercial Space
Dear [Landlord’s Name],
I am writing to express my interest in leasing the commercial space located at [Address]. Based on my initial assessment, I believe that this property meets my business requirements and is in a prime location to attract customers.
As a tenant, I am looking for a lease term of [Number of Years], starting on [Lease Start Date], and a monthly rent of [Rent Amount]. I would also like the option to renew the lease for additional terms, subject to mutual agreement.
Regarding the build-out of the space, I would like to propose the following:
- [List of Improvements Needed]
- [Estimated Cost of Improvements]
- [Timeline for Completion]
If this proposal meets with your approval, I would be happy to discuss the details further and enter into a formal lease agreement.
Thank you for considering my proposal. I look forward to hearing from you soon.
Sincerely,
[Your Name]
Letter of Intent to Purchase Commercial Property
Dear [Seller’s Name],
I am writing to express my interest in purchasing the commercial property located at [Address]. After conducting extensive research and due diligence, I am convinced that this property is an excellent investment opportunity that aligns with my long-term goals.
As a buyer, I am willing to offer [Purchase Price] for the property, subject to [List of Contingencies]. I would like to propose the following terms:
- [Proposed Closing Date]
- [Earnest Money Deposit]
- [List of Due Diligence Items]
If you are willing to accept these terms, I would be happy to move forward with the purchase and sale agreement, including any necessary amendments or addenda.
Please let me know if you have any questions or concerns. I am committed to making this deal a success for both of us.
Thank you for your time and consideration.
Sincerely,
[Your Name]
Letter of Intent to Sublease Commercial Space
Dear [Original Tenant’s Name],
I am writing to express my interest in subleasing the commercial space that you currently occupy at [Address]. As a [Type of Business], I believe that this space would be an ideal location for me to establish my operations and grow my brand.
I understand that you have [Number of Years] remaining on your lease agreement, which expires on [Lease End Date]. I would like to propose the following terms for the sublease:
- [Monthly Rent]
- [Sublease Start Date]
- [Sublease End Date]
- [List of Improvements Needed]
- [Estimated Cost of Improvements]
- [List of Shared Resources]
- [List of Restrictions or Conditions]
If this proposal meets with your approval, I would be happy to discuss the details further and enter into a formal sublease agreement. I am also willing to provide references or other documentation to support my application.
Thank you for your consideration. I look forward to hearing from you soon.
Sincerely,
[Your Name]
Letter of Intent to Develop Commercial Property
Dear [Landowner’s Name],
I am writing to express my interest in developing the commercial property located at [Address]. With my experience and expertise in [Type of Development], I believe that I can transform this property into a profitable and sustainable asset that will benefit both of us in the long run.
As a developer, I am looking for the following:
- [Length of Development Term]
- [List of Development Plans]
- [Estimated Development Cost]
- [Profit-Sharing Ratio]
- [List of Permits or Approvals Needed]
If you are interested in moving forward with this proposal, I would be happy to arrange a meeting to discuss the details further and sign a letter of intent outlining our mutual commitments and expectations.
Thank you for your time and consideration. I am confident that we can achieve great things together.
Sincerely,
[Your Name]
Letter of Intent to Expand Commercial Space
Dear [Landlord’s Name],
I am writing to express my interest in expanding the commercial space that I currently lease from you at [Address]. Due to the growth of my business and the increasing demand for my products and services, I need more space to accommodate my operations and employees.
As a tenant, I am willing to negotiate the following terms for the expansion:
- [Size of Additional Space]
- [Monthly Rent for Additional Space]
- [Estimated Cost of Build-Out]
- [Timeline for Completion]
If this proposal meets with your approval, I would be happy to discuss the details further and enter into a formal lease amendment or addendum.
Thank you for your consideration. I look forward to hearing from you soon.
Sincerely,
[Your Name]
Letter of Intent to Lease Commercial Property for Restaurant
Dear [Landlord’s Name],
I am writing to express my interest in leasing the commercial property located at [Address] for the purpose of opening a restaurant. After conducting extensive market research and analysis, I have identified this location as a prime opportunity to establish a new and exciting dining concept that will appeal to the local community.
As a tenant, I am looking for a lease term of [Number of Years], starting on [Lease Start Date], and a monthly rent of [Rent Amount]. I am also willing to negotiate the following terms:
- [List of Improvements Needed]
- [Estimated Cost of Improvements]
- [Timeline for Completion]
- [List of Equipment or Furniture Needed]
- [List of Permits or Licenses Needed]
If this proposal meets with your approval, I would be happy to discuss the details further and enter into a formal lease agreement.
Thank you for considering my proposal. I am confident that this restaurant will be a success and a valuable addition to your property.
Sincerely,
[Your Name]
Letter of Intent to Buy Land for Commercial Development
Dear [Landowner’s Name],
I am writing to express my interest in purchasing the land located at [Address] for the purpose of commercial development. After evaluating several potential sites, I have concluded that this property has the ideal mix of location, accessibility, and zoning that would allow me to build a successful and profitable project.
As a buyer, I am willing to offer [Purchase Price] for the land, subject to [List of Contingencies]. I would like to propose the following terms:
- [Proposed Closing Date]
- [Earnest Money Deposit]
- [List of Due Diligence Items]
- [List of Development Plans]
- [Estimated Development Cost]
- [Profit-Sharing Ratio]
- [List of Permits or Approvals Needed]
If you are interested in selling the property and agree with these terms, I would be happy to move forward with the purchase and sale agreement, including any necessary amendments or addenda.
Please let me know if you have any questions or concerns. I am committed to making this deal a success for both of us.
Thank you for your time and consideration.
Sincerely,
[Your Name]
Tips for Writing a Letter of Intent for Commercial Real Estate
When writing a letter of intent for commercial real estate, keep the following tips in mind:
- Be clear and concise in your language and objectives
- Include all the essential terms and conditions of the lease or purchase
- Be realistic and flexible in your proposals and demands
- Provide supporting documentation or references if possible
- Proofread your letter carefully and ask a friend or colleague to review it
By following these tips and using our samples as a guide, you can increase your chances of success and avoid common pitfalls in the negotiation process.
Frequently Asked Questions
What is the difference between a letter of intent and a lease agreement?
A letter of intent is a preliminary document that outlines the basic terms and conditions of a proposed lease or purchase, while a lease agreement is a detailed and legally binding contract that governs the rights and obligations of the landlord and tenant. A letter of intent is usually non-binding and subject to further negotiation and due diligence, while a lease agreement is final and enforceable.
Do I need a lawyer to draft a letter of intent for commercial real estate?
While it is not strictly necessary to hire a lawyer to draft a letter of intent, it is advisable to seek legal advice and review before signing any legally binding document. A lawyer can help you understand the implications of the terms and conditions of the letter of intent and make sure that they are fair and reasonable.
How long does a letter of intent remain valid?
A letter of intent is usually valid for a limited period of time, which can vary depending on the complexity of the transaction and the parties’ preferences. It is common to include an expiration date or a termination clause in the letter of intent that specifies the conditions under which it can be terminated or extended.
Can I modify or cancel a letter of intent after signing it?
Whether you can modify or cancel a letter of intent after signing it depends on the specific terms and conditions of the letter and the applicable laws and regulations. In general, a letter of intent is non-binding and subject to further negotiation and due diligence, so you can modify or cancel it without penalty. However, if the letter of intent contains a binding provision or a termination fee, you may need to consult with a lawyer or seek the other party’s consent before making any changes.
What happens if the parties cannot reach a final agreement after signing a letter of intent?
If the parties cannot reach a final agreement after signing a letter of intent, the letter of intent usually expires or terminates automatically, and the parties are free to pursue other options. However, if the letter of intent contains a binding provision or a termination fee, the parties may need to negotiate the consequences of the termination and the return of any deposits or fees paid.
Can I use a letter of intent for residential real estate?
While a letter of intent is commonly used in commercial real estate transactions, it can also be used in residential real estate transactions, especially in situations where the parties want to establish the basic terms and conditions of the sale or lease before entering into a formal contract. However, the legal and regulatory requirements for residential real estate transactions may differ from those for commercial real estate transactions, so it is important to consult with a lawyer or a real estate professional before using a letter of intent in a residential context.
Conclusion
A letter of intent is a valuable tool in the negotiation process for commercial real estate transactions. By using our samples and tips as a guide, you can write a letter of intent that reflects your interests and needs and increases your chances of success. Remember to be clear, concise, and realistic in your