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Lease With Option To Buy Contract Template for Saudi Arabia

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Key Requirements PROMPT example:

Lease With Option To Buy Contract

"I need a Lease with Option to Buy Contract for a commercial warehouse property in Riyadh, with a 3-year initial lease term starting March 1, 2025, and an option to purchase that can be exercised after 18 months of tenancy, with 50% of paid rent to be credited towards the purchase price."

Document background
The Lease with Option to Buy Contract is a specialized legal instrument used in Saudi Arabia when parties wish to combine a property lease with a potential future sale. This arrangement is particularly useful for businesses or individuals who want to occupy a property immediately while securing the right to purchase it later, whether for commercial, residential, or industrial purposes. The document must comply with Saudi Arabian real estate laws and Sharia principles, making it distinct from similar contracts in other jurisdictions. It typically includes detailed provisions for both the lease period (including rent, maintenance, and use restrictions) and the purchase option (including price determination, exercise period, and transfer procedures). This type of contract is commonly used in situations where immediate purchase is not feasible or desired, but there is a long-term interest in acquiring the property.
Suggested Sections

1. Parties: Identification of lessor/potential seller and lessee/potential buyer, including full legal names, addresses, and relevant identification numbers

2. Background: Context of the agreement, including property overview and parties' intentions regarding lease and potential purchase

3. Definitions: Key terms used throughout the agreement, including Property, Option Period, Purchase Price, and other relevant terminology

4. Property Description: Detailed description of the property, including address, title deed number, and full legal description as per Saudi property registration requirements

5. Lease Terms: Core lease provisions including rent amount, payment terms, duration, and maintenance responsibilities

6. Option to Purchase: Terms of the purchase option, including option period, exercise process, and purchase price calculation

7. Property Handover: Conditions and process for initial property handover for lease and subsequent handover upon purchase

8. Maintenance and Repairs: Responsibilities for property maintenance, repairs, and improvements during the lease period

9. Insurance and Risk: Requirements for property insurance and allocation of risk during lease period

10. Default and Termination: Events of default, remedies, and termination procedures for both lease and option components

11. Governing Law and Dispute Resolution: Confirmation of Saudi law governance and dispute resolution mechanisms compliant with local requirements

Optional Sections

1. Utilities and Services: Include when responsibilities for utilities and services need to be explicitly allocated between parties

2. Subletting and Assignment: Include when parties want to address possibility of subletting or assigning rights under the agreement

3. Property Modifications: Include when lessee may need to make modifications to the property during lease period

4. Foreign Ownership Provisions: Include when either party is non-Saudi to address relevant foreign ownership requirements

5. Financing Provisions: Include when purchase option may involve external financing arrangements

6. Property Management: Include for commercial properties requiring specific management arrangements

7. Environmental Matters: Include for industrial or commercial properties with potential environmental concerns

Suggested Schedules

1. Property Details Schedule: Detailed technical description of property, including plans, boundaries, and fixtures

2. Rent Payment Schedule: Detailed breakdown of rent payments, including amounts and due dates

3. Purchase Price Calculation: Formula or method for calculating final purchase price, including credit for rent paid

4. Property Condition Report: Detailed assessment of property condition at lease commencement

5. Permitted Use Schedule: Specific details of permitted uses of the property during lease period

6. Maintenance Schedule: Detailed breakdown of maintenance responsibilities between parties

7. Required Consents and Approvals: List of necessary governmental or regulatory approvals required for lease and sale

Authors

Alex Denne

Head of Growth (Open Source Law) @ 黑料视频 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

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Relevant Industries

Real Estate

Commercial Property

Residential Property

Retail

Industrial

Hospitality

Manufacturing

Warehousing

Office Space

Agricultural

Healthcare

Education

Relevant Teams

Legal

Real Estate

Operations

Finance

Compliance

Risk Management

Facilities Management

Corporate Development

Property Management

Asset Management

Investment

Business Development

Relevant Roles

Real Estate Manager

Property Manager

Legal Counsel

Contract Administrator

Facilities Manager

Chief Financial Officer

Real Estate Development Director

Asset Manager

Operations Manager

Commercial Director

Investment Manager

Corporate Real Estate Manager

Compliance Officer

Risk Manager

Business Development Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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