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Free Rent Period
Practical Law Glossary Item 7-546-4185 (Approx. 3 pages)
Glossary
Free Rent Period
An incentive landlords grant to tenants in lease agreements. The negotiating leverage of the parties and the market conditions commonly impact the scope of the free rent period.
A free rent period generally:
- Is given as an inducement to the tenant to enter into a lease agreement.
- May occur only at the beginning of the lease term or may occur throughout the term of the lease.
- Applies only to tenant's obligation to pay base rent.
- Does not affect a tenant's obligation to pay additional rent during the free rent period.
For sample free rent clauses in a commercial lease, see Standard Clauses, Free Rent Period (Commercial Lease) (Pro-Landlord) and Free Rent Period (Commercial Lease) (Pro-Tenant).