A commercial lease (hyresavtal or hyreskontrakt för lokal) governs almost everything that affects your finances and day-to-day life as a tenant: the rent, how long you are tied in, who is responsible for maintenance and what happens when the lease expires. Swedish law gives commercial tenants weaker protection than residential tenants, so what the lease says is decisive. Here we go through what a commercial lease should contain, and at the bottom there is a free template you can start from.
Short answer: A commercial lease must be in writing if either party asks for it, and in practice it is always in writing. It should cover the parties, premises and permitted use, term and termination, rent and supplements, indexation, VAT, maintenance, fit-out, security, subletting and security of tenure. Most landlords use the standard form from Fastighetsägarna (the Swedish property owners' association) with appendices.
What does Swedish law say about commercial leases?
Commercial tenancies are governed by Chapter 12 of the Land Code (jordabalken), known as the Tenancy Act (hyreslagen). A lease must be drawn up in writing if the landlord or the tenant asks for it. An oral agreement is therefore valid, but hard to prove, and several terms require written form to apply.
Many of the statutory rules only apply if the parties have not agreed otherwise. That gives a lot of freedom, but also a responsibility to read the lease. A walkthrough of the whole process is in the checklist for renting an office.
What a commercial lease should contain
| Item | What it should state |
|---|---|
| Parties | Name and company registration number of landlord and tenant |
| Premises | Address, property designation, area, floor and floor plan as an appendix |
| Permitted use | What the premises may be used for, for example offices |
| Term and termination | Start and end dates, notice period and how the lease is renewed |
| Rent | Annual amount excluding VAT and when rent is paid |
| Supplements | Heating, cooling, electricity, water, property tax and operating costs |
| Indexation | Whether and how the rent is adjusted each year |
| VAT | Whether the landlord charges VAT and what applies if that changes |
| Condition and fit-out | Condition of the premises at handover and what building work will be done |
| Maintenance | Who is responsible for what, ideally in a responsibility matrix |
| Security | Deposit, bank guarantee or a guarantee from a third party (borgen) |
| Assignment and subletting | Whether you may sublet or assign the lease |
| Reinstatement | The condition in which the premises must be returned |
The five terms that matter most
Term and renewal. Commercial leases are usually signed for three to five years. If nobody gives notice in time, the lease is renewed, often for three years at a time. Read more about terminating a commercial lease.
Index clause. The rent is normally adjusted each year in line with the consumer price index (CPI, KPI in Swedish). This is only allowed if the lease is for a fixed term of at least three years. Read more about rent indexation.
VAT. The landlord usually adds 25 percent VAT to the rent. Read more about VAT on commercial rent.
Security of tenure. You are entitled to compensation if the landlord terminates the lease without an acceptable reason, unless you have waived this security of tenure (besittningsskydd) in a separate document. Read more about security of tenure for commercial premises.
Security. The landlord almost always wants security for the rent. A bank guarantee carries an annual fee and the bank often requires collateral for it, while a deposit ties up capital directly. The amount is often a few months' rent and is negotiable.
Common appendices
- Floor plan of the premises
- Index clause
- Property tax clause
- Responsibility matrix for maintenance and operation
- Description of the tenant fit-out (hyresgästanpassning), with drawings and schedule
- Agreement on waiving security of tenure, if the parties agree on it
- Special provisions, for example on signage, opening hours or environmental requirements
Free template: commercial lease for premises
The template below is a simplified starting point for straightforward lettings, for example a small office or a sublease. It does not replace legal advice. For longer leases and larger areas, use the industry standard form and have someone experienced review the lease.
- Parties. Landlord: name, company registration number, address. Tenant: name, company registration number, address.
- Premises. Address, property designation, area in square metres. The premises are shown on the attached floor plan.
- Permitted use. The premises are let for use as offices.
- Term. From date up to and including date.
- Termination and renewal. The lease must be terminated in writing no later than nine months before the end of the term. Otherwise the lease is renewed for three years at a time.
- Rent. Amount in SEK per year excluding VAT, payable in advance no later than the last weekday before the start of each calendar quarter.
- Indexation. The rent is adjusted according to the attached index clause. Only applies to fixed-term leases of at least three years.
- Supplements. Heating, hot water, cooling and electricity are included in the rent, or paid by the tenant as follows. Property tax is reimbursed according to the attached clause.
- VAT. The tenant shall use the premises in a VAT-liable business. The landlord is entitled to charge VAT on the rent and supplements.
- Condition at handover. The premises are let in their existing condition, or with the following work carried out by the landlord before handover.
- Maintenance. The landlord is responsible for maintaining the premises and the building, with the exceptions set out in the attached responsibility matrix.
- Alterations. The tenant may not alter the premises without the landlord's written consent.
- Security. No later than handover, the tenant provides security in the form of a deposit or bank guarantee for the amount of.
- Subletting and assignment. Requires the landlord's written consent.
- Insurance. The tenant shall hold business insurance for its activities in the premises.
- Reinstatement. On moving out, the premises shall be left thoroughly cleaned and in the following condition.
- Signatures. Place, date and authorised signatories for both parties. The lease is drawn up in two copies.
Common mistakes
- Comparing premises on rent per square metre without including supplements, indexation and fit-out.
- Missing the last date for notice and being tied in for another three years.
- Signing a waiver of security of tenure without understanding what it means.
- Not agreeing who pays for reinstatement when you move out.
- The person signing is not an authorised signatory.
Frequently asked questions
Does a commercial lease in Sweden have to be in writing?
Only if either party asks for it, but in practice it should always be in writing. A waiver of security of tenure must also be in a separately drawn up document, and an index clause requires a fixed-term lease of at least three years.
How long is a commercial lease?
Usually three to five years. Index clauses require a term of at least three years, which is one reason three years is the most common.
Can you use a template for a commercial lease?
Yes, for straightforward lettings. The longer the lease and the larger the area, the more important it is to use the industry standard form and get help with the review.
What is the difference between hyresavtal and hyreskontrakt?
None. Hyreskontrakt is the everyday word, while the law uses hyresavtal. Both mean lease.
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