A renewal option allows the tenant, when the conditions stipulated in the bail are met, to extend the lease for an additional period.
The lease may provide for one or more renewal periods and determine their duration. It may also specify the conditions that will apply during the renewed period, including how the rent will be determined.
The renewal option must generally be exercised in the manner stipulated in the lease. This may, in particular, require the tenant to provide the landlord with written notice within a specified period before the lease expires .
It is important to respect the terms and deadlines stipulated. For example, if the lease specifies that the option must be exercised at least six months before its expiry, the tenant should submit their notice within this timeframe and according to the method specified in the lease.
The lease may also stipulate certain conditions for exercising the option, including that the tenant is not in default at the time of exercising it or at the beginning of the renewal period.
The late exercise of a renewal option may result in the loss of the right to renewal. Therefore, the tenant should not assume that the landlord will be obligated to accept a notice given after the expiry of the period stipulated in the lease.
When the term has expired, the parties may nevertheless agree to renew the lease. In this case, the agreement reached between them must be examined, rather than assuming that the initial option automatically remains applicable.
It is therefore important for the tenant to check well in advance the deadline, the form of the notice, its method of transmission and other conditions provided for exercising their renewal option .