Why Reading the Lease Matters More Than You Think
In Bangkok's commercial rental market, verbal agreements are common — but they're meaningless in court. The signed Thai-language lease is the document that governs your tenancy, and many tenants only discover unfavourable clauses after problems arise. Here are eight things you must check before putting pen to paper.
1. The Parties and the Property Description
Confirm that the landlord named in the lease is actually the registered owner (or has legal authority to lease the property). Ask to see the Chanote (โฉนด) — the title deed — and verify the named owner matches. This protects you from fraudulent subletting arrangements.
2. The Lease Term and Renewal Rights
Thai law limits unregistered leases to a maximum of 3 years. Leases longer than 3 years must be registered at the Land Department to be enforceable. Key questions:
- What is the exact start and end date of the lease?
- Is there a renewal option, and under what conditions?
- How much notice must you give if you intend to renew or vacate?
3. The Rent Amount, Payment Date, and Escalation Clause
Confirm the monthly rent in figures and words. Check for any automatic escalation clause — it's common for Thai commercial leases to include a 5–10% rent increase upon renewal. If this is built into a mid-term increase clause, understand exactly when it kicks in.
4. The Deposit Terms
The deposit (usually 2–3 months' rent) should be clearly defined:
- Exact amount held
- Conditions under which deductions can be made
- Timeline for return after lease expiry (commonly 30 days)
- Whether the deposit earns interest (rare, but worth checking)
Tip: Keep a photographic record of the unit's condition at key handover. This protects your deposit claim.
5. Permitted Use of the Space
The lease will typically specify what type of business may operate on the premises. If you plan to serve food, confirm this is explicitly permitted. If you want to add a sign on the outer wall, it may require separate landlord approval. Operating outside the permitted use can be grounds for immediate termination.
6. Alteration and Fit-Out Rights
Commercial tenants almost always need to modify the space — installing counters, partitions, signage, or equipment. The lease must address:
- What alterations are permitted without prior consent
- What requires written landlord approval
- Whether you must restore the space to its original condition at the end of the lease (this can be very costly)
7. Maintenance and Repair Responsibilities
This is one of the most contentious areas between landlords and tenants. Clarify in writing:
- Who is responsible for structural repairs (roof, walls, foundations) — typically the landlord
- Who handles internal fixtures, plumbing, electrical — typically the tenant
- Air conditioning maintenance and servicing responsibility
- Common area maintenance fees (if applicable in a building or mall)
8. Early Termination Clause
Business conditions change. Understand what happens if you need to exit the lease early:
- Is there a break clause, and under what conditions can it be triggered?
- What penalty applies for early exit — is it forfeiture of the full deposit, or additional months' rent?
- Can you sublet or assign the lease to another party if you sell or close your business?
Always Get Legal Advice
For any commercial lease in Thailand, we strongly recommend consulting a licensed Thai lawyer or a reputable property consultant before signing — especially if the lease is in Thai only. The cost of a legal review is minimal compared to the cost of being locked into an unfavourable tenancy.
Quick Checklist Summary
- Verify landlord identity against title deed
- Check lease term and renewal conditions
- Understand rent and escalation terms
- Clarify deposit amount and return conditions
- Confirm permitted business use
- Review alteration and fit-out rights
- Define maintenance responsibilities
- Understand early termination penalties