• Ground leases

One form of lease is a long-term ground lease under which a tenant leases vacant land for development. Once the development is completed, the ground tenant will sublet space to retail, office, or industrial tenants, depending on the type of the development. This structure is rarely used because the ground leasehold interests cannot be bought and sold in a manner similar to freehold property interests.

• Commercial leases

A commercial lease is used for most commercial office and retail space and some standard industrial space. Most commercial lease transactions commence with an offer to lease, which contains the business terms agreed upon by the parties, including the space, term, rent and any tenant inducements. Commercial leases are typically on a net/net rental basis, which requires a tenant to pay basic rent plus additional charges (additional rent) for a proportionate share of realty taxes, insurance, utility, and common area maintenance charges. In a retail lease, a tenant may also be required to pay rent based on a percentage of its annual sales.

• Residential leases

Residential leases are regulated in more detail by the special Tenant Protection Law, which overrides any contrary terms of the lease contract, regardless of the intention of the parties. This law imposes limits on the rent increase and limits the ability to terminate the lease.

Lease provisions are regulated in the Civil Code. However, to a large extent, they are freely negotiable. The Civil Code provisions on leases have a semi-imperative character, which means that the legal provisions can be changed but only in favor of the tenant. However, residential leases are fully regulated and the ability to negotiate different terms are limited.

The maximum term for a lease with an individual is 10 years. The maximum term for a lease with a company or for a ground lease is 30 years. The maximum term of the leases cannot be extended. In order to extend the term, a new lease needs to be concluded after the expiration of the maximum term of the lease.

The usual terms of the lease are three, five or 10 years. These terms can be extended up to the maximum lease term under Polish law.

A tenant may request an extension of the lease only if they have a right to do so under the lease agreement.

A landlord can generally terminate the lease when the tenant breaches the terms of the lease. The typical tenant breaches include the late payment of rent for more than two rent periods, use of the premises in a manner that is contrary to the agreed use, assignment or sublease of the property without the consent of the landlord, or the tenant becomes insolvent (subject to statutory restrictions).

No. Rent can be paid in a foreign currency. However, rent is typically paid in euros in an amount equivalent to the local currency.

Typically, rent is paid in advance on a monthly basis. However, this may change depending on the agreement of the parties.

Rent is usually fixed for an initial term and subject to yearly indexation. Rent for renewals or extensions may also be fixed or may be adjusted to reflect the market value at the time of such renewal or extension.

The Tenant Protection Law sets an allowable annual percentage increase in rent for residential leases.

The following are usually required of landlords:

• Repair and maintain the structure of the property
• Provide standard services relating to the functioning of the property
• Insure the property

The following are usually required of tenants:

• Pay rent on time
• Keep the property in good order
• Inform the landlord if repairs are needed and give the landlord access to the property to carry out repairs
• Give the landlord access (often by appointment) to the property for inspections and to perform landlord’s work

The tenant is required to obtain the landlord’s consent to assign or sublet the premises.

If the premises are substantially damaged or destroyed, the lease will expire. If the damages are less than substantial, rent is generally reduced according to the extent of the damage or destruction.

If the premises are damaged or destroyed due to causes attributed to the tenant, the tenant may be liable for repairs or replacement.

The landlord is responsible for insuring the leased premises. The tenant is responsible for insuring the property it brings into the premises.

Yes. However, the new owner may terminate the lease. The former owner will be liable to the tenant for damage caused by an earlier termination.

However, the new owner will not be able to terminate the lease if the lease is for a fixed time with an authenticated date (e.g., signed in front of a public notary) and the tenant has taken possession of the premises.

Yes. However, the new owner may terminate the lease unless the lease is for a fixed time with an authenticated date (e.g., signed in front of a public notary) and the tenant has taken possession of the (subject to further termination rights of the new owner).

Additionally, the lease may be terminated if the lease agreement was concluded after the commencement of foreclosure proceedings concerning the real property.