Our lease doesn’t specifically state that there is an option to renew, but there is a clause whereby the lessee must confirm its intention of re-signing the lease 6 months prior. In this case, the Company definitely intends to re-sign due to the significant leasehold improvements and has informed the landlord. Would you extend the term to factor in the intention to re-sign the lease for another term?
Option to renew
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In this case, there is no enforceable right to extend that the lessee can exercise. However, if the company definitely intends to re-sign, the lessor has also confirmed that they intend to re-sign the lease, and the company has a history of re-signing the lease, then it is reasonably certain that the lease term will include the length of the re-signed lease.