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The Option To Lease Agreement is a crucial document in New Zealand commercial property transactions, providing a bridge between initial property interest and final lease commitment. It is commonly used when a potential tenant requires time to secure financing, obtain regulatory approvals, or complete due diligence before committing to a lease. The agreement protects both the property owner's and potential tenant's interests by clearly defining the option period, consideration paid, and conditions for exercise. This document is particularly valuable in new developments, business expansions, or when significant property modifications are required before occupancy. The agreement must comply with New Zealand property and contract law, including the Property Law Act 2007, and typically includes detailed terms about the proposed lease, property access during the option period, and the mechanism for exercising the option.

1. Parties: Identifies and defines the parties: the Option Grantor (property owner/current landlord) and Option Holder (potential tenant)

2. Background: Sets out the context of the agreement, including property ownership and intention to grant an option to lease

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes interpretation rules

4. Grant of Option: Explicitly states the grant of the option and its basic terms

5. Option Period: Specifies the duration during which the option can be exercised

6. Option Fee: Details the fee payable for the option and payment terms

7. Exercise of Option: Specifies how and when the option must be exercised, including notice requirements

8. Lease Terms: Outlines the key terms of the lease that will come into effect if the option is exercised

9. Property Access: Rights of the Option Holder to access and inspect the property during the option period

10. Obligations During Option Period: Responsibilities of both parties during the option period

11. Assignment: Restrictions on transferring or assigning the option rights

12. Termination: Circumstances under which the option agreement can be terminated

13. General Provisions: Standard contract clauses including notices, governing law, and dispute resolution