Glossary / Lease terms and deal stages
Also known as: Commencement date, term commencement date
The lease commencement date is the date the lease term begins and the landlord's and tenant's rights and obligations under the lease take effect. It can differ from the signing date, the date rent starts, and the date the tenant moves in.
Realogic defines the commencement date as "the date upon which the landlord and the tenant's rights and obligations under the lease begin." Barnes Walker's legal glossary describes it as "the date the lease term begins," often when the tenant takes possession.
Commencement is often defined by an event rather than a calendar date, for example delivery of the premises or substantial completion of landlord work under a Work letter. Realogic notes that the commencement date may align with the effective date but often differs from when rent payments begin or when the tenant physically occupies the space. The lease term, and so its expiration date, is usually counted from commencement.
The commencement date can move your payment date and your commission base. If part of your fee is tied to commencement, delivery, or Occupancy, any construction delay pushes your payment back. And because the lease term is measured from commencement, it fixes the period over which total rent, and any commission calculated on total rent, is measured.
Do not assume commencement and rent start are the same day. StrataFolio notes that the two often diverge where there are free rent periods or build-out phases. If your Commission agreement says "commencement," confirm whether it means the lease commencement date or the Rent commencement date.
Find the clause in the lease that defines the commencement date and note what event triggers it, since that event may also trigger part of your commission.
