Real‑world examples of 3 examples of lease agreement for retail space

Example of a standard gross lease for a small street‑front shop

When people ask for examples of 3 examples of lease agreement for retail space, the most familiar scenario is a small, street‑front shop on a busy neighborhood corridor. Think: a 900‑square‑foot boutique or specialty gift store.

In a typical gross lease for this kind of retail space:

• The tenant pays a flat monthly rent (for example, $3,000 per month).
• The landlord pays property taxes, building insurance, and common‑area maintenance (CAM).
• Utilities might be separately metered or folded into the rent with a usage cap.

This example of a lease agreement for retail space usually runs three to five years, with an option to renew. Annual rent increases are often tied to a fixed percentage—say 3% per year—or a recognized inflation index. In the United States, many landlords reference the Consumer Price Index (CPI) published by the Bureau of Labor Statistics (BLS), which tracks inflation trends nationwide (BLS CPI data).

Key clauses you’ll typically see in a standard gross retail lease:

• Use clause: Limits the space to specific uses (e.g., “women’s apparel and accessories”). This protects both the landlord’s tenant mix and your right to operate without a competitor moving in next door under the same roof.
• Signage rights: Specifies where and how you can display your signs, window decals, and sandwich boards.
• Hours of operation: In neighborhood retail, these are often flexible but may require minimum hours.
• Assignment and subletting: Important if you want the option to sell your business or bring in a sub‑tenant later.

One of the best examples of a tenant‑friendly twist in this format is a shorter initial term with multiple renewal options. Instead of locking into a straight 10‑year commitment, a boutique might sign a three‑year lease with two three‑year renewal options at pre‑negotiated rent. That gives the tenant a realistic exit ramp if the location underperforms.

Percentage rent: examples of lease agreement for retail space in malls

Another category in our examples of 3 examples of lease agreement for retail space is the classic percentage rent structure, common in shopping malls and high‑traffic centers.

Here, the tenant pays:

• A base rent (for example, $2,000 per month), plus
• A percentage of gross sales over a specified “breakpoint” (for example, 6% of annual sales over $400,000).

Imagine a cosmetics kiosk in a regional mall. If its annual sales hit \(600,000 and the breakpoint is \)400,000, the tenant pays percentage rent on the \(200,000 above the breakpoint. At 6%, that’s \)12,000 in additional rent on top of base rent.

This kind of lease is attractive to landlords when they believe they can drive strong foot traffic and sales. For tenants, it can be helpful in the early ramp‑up phase because base rent is usually lower than in a pure fixed‑rent deal.

Details to watch in percentage rent examples include:

• Definition of “gross sales”: Does it include online orders picked up in store? Gift cards? Returns? You want clear, narrow definitions.
• Audit rights: Landlords often reserve the right to audit your sales reports; tenants should ensure audits are limited to reasonable frequency and scope.
• Radius restrictions: To protect percentage rent, landlords may limit your ability to open competing stores within a certain radius.

A real‑world 2024 trend: many mall landlords are pushing hybrid models where percentage rent kicks in at lower breakpoints to share more upside. Tenants with strong online sales should negotiate carefully so that only in‑store or clearly attributable sales are counted.

Triple‑net (NNN) leases: examples include strip centers and power centers

The third major category in our examples of 3 examples of lease agreement for retail space is the triple‑net (NNN) lease, common in strip centers, power centers, and stand‑alone pad sites.

In an NNN lease, the tenant pays:

• Base rent, plus
• A share of property taxes,
• A share of building insurance, and
• A share of common‑area maintenance (CAM).

If you’re leasing a 1,500‑square‑foot space in a 15,000‑square‑foot strip center, you might be responsible for 10% of the property’s taxes, insurance, and CAM costs. On paper, NNN leases can look cheaper because the base rent is lower—but the pass‑through expenses add up quickly.

Key issues in NNN lease examples:

• CAM caps: Tenants often negotiate caps on annual CAM increases (for example, no more than 5% per year).
• Exclusions: Tenants try to exclude capital improvements, structural repairs, or landlord overhead from CAM.
• Transparency: Detailed annual CAM statements with the right to review underlying invoices.

NNN leases are favored by many institutional investors because they create predictable income streams. The structure is widely used in single‑tenant deals with national brands like pharmacies or quick‑service restaurants. The trade‑off: tenants accept more variable cost risk in exchange for lower base rent and highly visible locations.

Beyond the big three: hybrid and modern examples of retail lease agreements

So far, we’ve walked through three classic models. But the best examples of modern retail leases in 2024–2025 are often hybrids that mix elements of gross, NNN, and percentage rent.

Some real‑world examples include:

• Modified gross with CAM pass‑throughs: Base rent covers taxes and insurance, but tenants share certain CAM costs like snow removal or security.
• Stepped‑up rent schedules: Rent starts low in year one and increases more steeply in years two and three to help new concepts ramp up.
• Turnover‑only rent for pop‑ups: Short‑term pop‑up shops in high‑street locations sometimes pay only a percentage of sales, with no base rent, for 3–6 months.
• Co‑tenancy‑linked rent: In lifestyle centers, rent may be reduced or adjusted if a key anchor tenant closes or occupancy drops below a threshold.

These hybrid formats are increasingly common as landlords and tenants respond to e‑commerce, changing consumer behavior, and the lingering effects of pandemic‑era disruptions. The U.S. Census Bureau continues to report strong e‑commerce growth even as in‑person retail rebounds, which pushes landlords to be more flexible with lease structures to keep physical spaces filled (U.S. Census retail indicators).

When you look at examples of 3 examples of lease agreement for retail space today, you’ll often see hybrid models used for:

• Direct‑to‑consumer brands testing their first physical showroom.
• Food‑and‑beverage concepts in mixed‑use projects.
• Fitness and wellness studios that rely on memberships and class packs.

6 detailed, real‑world style examples of lease agreement for retail space

To make this more concrete, here are six realistic scenarios that mirror what’s actually being signed in the market.

1. Independent clothing boutique on a neighborhood main street

• Type: Standard gross lease
• Size: 1,000 sq. ft.
• Term: 3 years, with one 3‑year renewal option
• Rent: $32 per sq. ft. per year, flat 3% annual increases
• Highlights:
  • Landlord covers taxes, insurance, and building maintenance.
  • Tenant pays separately metered electricity and internet.
  • Use clause allows clothing, shoes, accessories, and small gift items.
  • Early termination right if building is sold and the new owner refuses to honor the renewal option.

This is one of the best examples of a straightforward, understandable agreement for a first‑time retail tenant.

2. Coffee shop in an urban mixed‑use building

• Type: Modified gross with partial CAM pass‑throughs
• Size: 1,200 sq. ft.
• Term: 5 years, with a 5‑year renewal option
• Rent: Base rent plus proportionate share of lobby cleaning and security costs
• Highlights:
  • Tenant responsible for all interior build‑out and equipment.
  • Landlord provides a rent‑free build‑out period of 3 months.
  • Grease traps and venting requirements are detailed in the lease.

This example of a lease agreement for retail space shows how building‑wide services can flow through to tenants even when taxes and insurance stay with the landlord.

3. National athletic shoe brand in a regional mall

• Type: Base rent plus percentage rent
• Size: 3,500 sq. ft.
• Term: 10 years, with multiple renewal options
• Rent: Base rent plus 7% of gross sales over a negotiated breakpoint
• Highlights:
  • Extensive co‑tenancy clause: if the main anchor store leaves and is not replaced, tenant can reduce rent or terminate.
  • Detailed visual merchandising and store hours requirements.
  • Strong radius restriction to prevent cannibalizing sales.

This is one of the clearest examples of how landlords and tenants share risk and reward in a mall environment.

4. Fast‑casual restaurant in a suburban strip center

• Type: Triple‑net (NNN)
• Size: 2,000 sq. ft.
• Term: 10 years, with two 5‑year options
• Rent: Lower base rent, plus proportionate share of taxes, insurance, CAM
• Highlights:
  • Tenant pays for its share of parking lot maintenance and landscaping.
  • CAM increases are capped at 4% per year.
  • Landlord delivers a “vanilla shell”; tenant funds full kitchen build‑out.

Among our examples of 3 examples of lease agreement for retail space, this one shows how NNN costs can be a major line item for restaurant operators, who already face high equipment and staffing costs.

5. Wellness studio in a lifestyle center

• Type: Hybrid: base rent + limited percentage rent
• Size: 1,800 sq. ft.
• Term: 7 years
• Rent: Base rent plus 3% of revenue above a modest breakpoint
• Highlights:
  • Percentage rent applies only to in‑studio membership and class revenue, not online programs.
  • Co‑tenancy clause tied to the continued operation of a grocery anchor.
  • Right of first refusal on adjacent space for future expansion.

This example of a retail lease agreement shows how service‑based tenants can negotiate percentage rent narrowly tailored to their revenue streams.

6. Pop‑up concept store in a high‑street corridor

• Type: Short‑term turnover‑only lease
• Size: 600 sq. ft.
• Term: 4 months
• Rent: 15% of gross in‑store sales, no base rent
• Highlights:
  • Landlord can terminate early if a long‑term tenant signs a standard lease.
  • Tenant receives minimal improvements; space is taken “as‑is.”
  • Marketing collaboration clause: landlord promotes the pop‑up in center‑wide campaigns.

This is one of the best examples of how landlords fill vacancies temporarily while brands test markets without long‑term commitments.

Key negotiation points across these examples of retail leases

Looking across all these examples of 3 examples of lease agreement for retail space, certain negotiation themes repeat:

Base rent and increases
Tenants want predictable increases, ideally fixed or tied to a well‑known index. Landlords push for higher escalations in inflationary environments, which have been a recurring concern in 2023–2024 according to publicly available inflation data from the BLS.

Operating expenses and CAM
The difference between a fair NNN or modified gross lease and a painful one is usually in the fine print. Smart tenants push for:

• Clear definitions of CAM.
• Exclusion of capital expenditures and landlord overhead.
• Caps on annual increases.

Use and exclusivity
Retailers often negotiate an exclusive use clause to prevent direct competitors in the same center (for example, being the only full‑service yoga studio). Landlords try to keep these as narrow as possible to preserve leasing flexibility.

Tenant improvements and build‑out
In 2024–2025, many landlords are offering more tenant improvement (TI) allowances to attract quality tenants, especially in urban markets that are still re‑balancing office and retail demand. Tenants should clarify:

• When TI funds are paid.
• What documentation is needed.
• Who owns built‑in improvements at lease end.

For broader background on commercial leasing concepts, many small‑business owners consult resources from the U.S. Small Business Administration (SBA), which offers guidance on choosing and negotiating locations (SBA commercial leasing guidance).

FAQ: examples of lease agreement for retail space

Q1. Can you give more examples of clauses I should pay attention to in a retail lease?
Yes. Beyond rent and term, pay close attention to: maintenance responsibilities (who fixes HVAC and plumbing), insurance requirements and limits, personal guarantees, relocation rights (can the landlord move you to another space in the center), and rules about signage and window displays. These often decide how easy or difficult day‑to‑day operations become.

Q2. What is an example of a tenant‑friendly retail lease term for a new business?
A tenant‑friendly example is a shorter initial term (two to three years) with several renewal options, combined with a limited personal guarantee that burns off after a few years of on‑time payments. Some landlords also agree to a percentage‑rent‑only period during the first few months while you build traffic.

Q3. Are online sales usually included in percentage rent examples?
It depends entirely on the definition of “gross sales” in the lease. Many tenants negotiate to exclude online orders shipped from a warehouse. Landlords sometimes want to include buy‑online‑pick‑up‑in‑store (BOPIS) sales. The safest approach is to spell out exactly which revenue streams are included and which are not.

Q4. Where can I find sample language or templates for retail lease agreements?
Publicly available sample clauses appear in some state or local government resources and small‑business education materials. Law school clinics and legal aid organizations sometimes publish example provisions as teaching tools. For instance, some university‑affiliated small business clinics provide guidance on reading and negotiating commercial leases (Harvard Law School Transactional Law Clinics). Always have a licensed attorney in your state adapt any template to your specific deal.

Q5. Do these examples of 3 examples of lease agreement for retail space apply outside the United States?
The basic structures—gross, NNN, and percentage rent—are widely used in many countries, but tax rules, consumer laws, and standard terms differ. If you’re outside the U.S., use these examples as a framework, then consult local counsel to understand country‑specific requirements, including consumer protection and zoning rules.

The bottom line: by studying real‑world style examples of 3 examples of lease agreement for retail space—from simple gross leases to sophisticated hybrid structures—you can walk into negotiations with a clear sense of what’s typical, what’s negotiable, and what might be a deal‑breaker for your business.