• Ordinary leases (with statutory right of renewal except in certain instances)
• Fixed-term leases (with no right of renewal)

Lease provisions are generally freely negotiable subject to certain statutory restrictions, such as ground leases for the purpose of building ownership must be 30 years or more except a fixed-term ground lease for the purpose of building ownership, which must be 50 years or more, but a fixed-term ground leases for the ownership of building used solely for a business can be from 10 to 50 years.

There is no maximum term for building leases. However, the term of ground leases other than a fixed-term ground lease for the purpose of building ownership (e.g. golf course sites and parking lots) cannot exceed 50 years. If you need a ground lease term longer than 50 years for non-building ownership purpose, such as a solar power plant business, a superficies right is used. There is no maximum term for a superficies right.

Except for fixed-term leases, the lease term can be renewed.

Ordinary leases for residences and office space are often for two years and fixed-term leases can still be for two years but are often for five to 10 years but are used mostly for commercial leases.

Ground leases for the purpose of building ownership must be 30 years or more except fixed-term ground leases for the purpose of building ownership, which must be 50 years or more, but a fixed-term ground leases for the ownership of building used solely for business can be from 10 to 50 years.

Yes, tenants under ordinary leases generally have the statutory right to have their leases renewed subject to the payment of market rent. Tenants under fixed-term leases do not have the right to any extension or renewal (a new lease will need to be entered into subject to the parties agreeing to the terms and conditions of the new lease).

A landlord can generally terminate the lease under the following circumstances:

• End of the lease term for a fixed-term lease and subject to the statutory renewal right being exercised by the tenant under an ordinary lease
• Upon material breach of the lease terms

No, but landlords almost always require payment of rent in local currency.

Yes – rent is usually paid monthly and in advance but not required to be paid monthly or in advance if otherwise agreed.

Some longer-term leases have rent review clauses but it is usually based on the then market value subject to negotiations between the tenant and the landlord. Pursuant to the Land and Building Lease Law, the landlord or the tenant may request a review of the rent if the rent has become unreasonable due to change in taxes, impositions, the economy or other circumstances.

The following is usually required of landlords:

• Repair and maintain the land and building of the leased premises for its intended purposes
• Insure the property other than within the leased premises
• Comply with applicable laws

The following is usually required of tenants:

• Pay rent, security deposits and other amounts on time
• Use the premises within the scope of use permitted under the lease
• Keep the leased premises in good order
• Restore the leased premises to the original state upon end of the lease
• Comply with applicable laws and building rules

The transfer or assignment of the lease is usually not permitted without the landlord’s consent. Granting consent to sublet is often at the landlord’s sole discretion. The landlord may sometimes agree to permit a sublease without the landlord’s consent if the sublease is to an affiliate of the tenant.

If the premises is substantially damaged or destroyed by an act of God, the lease is often subject to termination. Some leases include a rent abatement clause determine based on the extent of the damage or destruction if the damage or destruction does not trigger termination.

If the premises is damaged or destroyed due to causes attributed to the tenant, then the tenant would be liable for repairs or replacement. Likewise, if the premises is damaged or destroyed due to causes attributed to the landlord, then the landlord would be liable for repairs or replacement.

The tenant is usually responsible for insuring improvements in the leased premises and the landlord is usually responsible for insuring the building shell and common areas.

Generally yes – the landlord’s position under the lease would transfer to the new owner of the property upon sale where the leasehold is perfected by:

• the registration of the leasehold interest,
• delivery of a building for a building lease
• owning the registered building on the leased ground for a ground lease.

However, if the original landlord and the new owner of the leased premises agree that the original landlord retains the status of lessor and that the new owner leases the leased premises to the original landlord, the status of lessor under the original lease is not transferred to the new owner. In such a case, if a lease between the original landlord and the new owner or its successors is terminated, the status of lessor under the original lease is transferred from the original landlord to the new owner or its successors.

If the tenant’s leasehold rights existed and perfected before the mortgage was registered, the lease would survive after the leased premises is foreclosed. However, if the tenant’s leasehold rights were created or perfected after the registration of the mortgage, the lease can be terminated upon foreclosure of the leased premises. However, for a building lease, the tenant is entitled to use the building for six months after the ownership of the building is transferred by the foreclosure.