Cash held by the landlord as collateral against tenant default, damage beyond normal wear and tear, or unpaid rent. The deposit is returned at lease end if the tenant has satisfied all obligations.
Security deposit amounts in commercial leases are negotiated freely — unlike residential leases, there is typically no statutory cap. Landlords commonly require one to six months of base rent, though credit-challenged tenants may be asked for more. Tenants should negotiate burn-down provisions that reduce the deposit over time as they demonstrate payment history. The lease should specify conditions for withholding, a deadline for return, and whether interest accrues. A letter of credit is frequently substituted for cash deposits in larger transactions.
Lextract extracts these fields directly from your lease PDF:
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