Contracts
Which clause in a commercial lease allows the tenant to expand into additional space as it becomes available?
ARight of first refusal
BExpansion option✓ Correct
CCo-tenancy clause
DExclusivity clause
Explanation
An expansion option in a commercial lease gives the tenant the right to lease additional space within the building or complex as it becomes available, providing flexibility for growing businesses.
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Key Terms to Know
Right of First Refusal
A contractual right giving a party the opportunity to match any offer received before the owner can accept it from a third party.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
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