The specific, legally allowed business activities the tenant can conduct.
Also known as: Authorized Use, Use Clause
By Angel Campa, Founder · Updated March 2026
A narrowly drafted permitted use clause can prevent the tenant from evolving their business model, adding product lines, or pivoting operations without landlord consent. "General office use" is broad; "accounting firm office use only" is restrictive. If the tenant wants to sublease, the permitted use clause constrains the pool of eligible subtenants. For retail tenants, the use clause also interacts with exclusive use provisions in other tenants' leases.
Found in the "Use" or "Permitted Use" section, typically within the first 10 pages. The clause defines what the tenant can do and often cross-references the prohibited uses list. Zoning compliance is usually referenced in the same section.
Lextract uses a combination of AWS Textract OCR and Claude AI to identify and extract the permitted use from your lease PDF. The AI searches for the field name and common aliases like "Authorized Use", "Use Clause" across all pages of the document, then assigns a confidence score based on OCR quality and extraction certainty. Fields with lower confidence are flagged for human review.
Prohibited Uses
Specific activities explicitly banned within the leased premises.
Fascia Signage
The right to affix branding directly onto the exterior wall of the building.
Monument Signage
The right to place the tenant's name on a shared roadside structure.
Signage Maintenance
Determines if the landlord or tenant is financially responsible for sign upkeep.
Tenants should always negotiate the broadest permitted use language possible, such as "any lawful commercial purpose" or "general retail and related uses." Broad language preserves flexibility for business evolution and makes the space easier to sublease if needed.
Yes. The tenant must comply with the lease's permitted use, local zoning laws, CC&Rs (covenants, conditions, and restrictions) for the property, and any exclusive use clauses granted to other tenants. All four constraints should be reviewed before signing.
What accuracy can you realistically expect from AI lease abstraction tools? We break down field-level accuracy rates, where AI excels, where it struggles, and how to validate output.
Compare the top AI lease abstraction tools for commercial real estate in 2026. We review Lextract, Prophia, Kolena, Leasecake, MRI Software, and more — with pricing, accuracy, and use-case guidance.
Free AI lease abstraction tools are fast and easy — but they have real limitations. Here is what free tools deliver, what they miss, and when you need structured output instead.
Upload your lease PDF and Lextract will extract permitted use along with 98 other structured fields in minutes. Just $20 per lease.
Upload Your Lease