REALWorld Law

Commercial leases

Length of leases

What is the usual length of each type of commercial lease?



There is no minimum or maximum term for a commercial lease. The duration of the lease term can be for any number of years or up to a fixed date.

Generally, a commercial office or retail lease for a larger tenant will be for five to ten years with one or more option terms (exercisable by the tenant) usually of one to five years each. Ground leases tend to be for longer terms such as 20 to 99 years, and in many cases the rent is prepaid for the entire term.

In most Canadian jurisdictions, leases for a period greater than three years may be registered on a public register maintained by the relevant government authorities subject to certain statutory requirements. The main benefit of registering the lease on a public register is to provide third parties with notice of the tenant's leasehold interest in the property. In some Canadian jurisdictions, registration of long-term leases (for example, for a term greater than 30 years in British Columbia) will attract land transfer tax in the same manner as a transfer of freehold title.