Rent in Renewal Terms:
If the tenant exercises an option to renew the lease at the end of the initial term the parties need to agree on what the new rent amount will be for those subsequent periods. Our lease agreements give you two choices for determining the rent, as explained below:
Fair Market Value: If this option is included in the lease, then the monthly rent for renewal terms will be what the parties agree is a fair market value rent for that property at that time. This provision gives the parties the flexibility to wait and see what a fair market rent would be at a future date, but it leaves the issue open for disagreement later on.
Predetermined Amount: If this option is included in the lease, then the monthly rent for renewal terms will be whatever you enter now. This provision removes the uncertainty about what the rent will be at a later time, but whatever is chosen now may not be in line with fair market rates in the years ahead. If you choose this provision, you will be prompted to enter the dollar figure of monthly rent in renewal terms.