Holdover Rent Clauses: Avoid Paying 150–200% After Your Lease Ends

“Holdover” is what happens when your lease term ends but you’re still in the space—even for a few days because your new location isn’t ready, your buildout ran long, or your move didn’t go as planned.

Many commercial leases treat holdover as a default and impose punitive rent (often 150%–200% of rent), plus damages. This guide explains how holdover clauses work, what’s normal, what’s risky, and what tenants negotiate to avoid end-of-lease surprises. (Not legal advice.)

Holdover vs renewal vs extension (don’t confuse these)

Renewal option: you must give notice within a defined window to extend for a new term (see /blog/renewal-options-notice).
Extension / short-term addendum: a written agreement to extend for a few weeks/months.
Holdover: you stayed without a signed extension.

Landlords often use holdover pressure to force a quick renewal on landlord-friendly terms. Avoid that leverage by planning for a written extension if there’s any chance you’ll need it.

What holdover rent usually looks like

Common structures include:

150% of base rent for the first 30–60 days, then 200% after that.
Holdover rent based on fair market rent (FMV), sometimes the greater of FMV or a percentage multiple.
Holdover applies to base rent + additional rent (CAM/taxes/insurance), not just base rent.
Holdover is treated as a month-to-month tenancy (but landlord still keeps strong termination rights).

Two important “gotchas”:

Acceptance of rent may not waive default. Many leases say the landlord can accept your money and still claim you’re in default.
Holdover can trigger “consequential damages.” Some leases try to make you responsible for the landlord’s losses if a new tenant can’t move in on time (leasing commissions, buildout delays, etc.).

Why holdover clauses are so tenant-unfriendly

Holdover rent is designed to discourage staying. The landlord wants flexibility to:

deliver the space to the next tenant on schedule
renovate/reposition the property
avoid arguments about what “month-to-month” means

From the tenant side, holdover often happens for normal operational reasons (permits, contractor delays, shipping, staffing). The key is to keep an end-of-term slip from becoming a budget-breaking event.

Tenant-friendly holdover terms to negotiate

If you’re negotiating a lease now, aim for language that matches real-world moveout risk:

1) A reasonable rate (and a grace period)

Ask for:

No penalty for the first X days (e.g., 3–7 days), or
125% for the first 30 days, then 150% thereafter

Some landlords won’t grant a grace period, but many will soften the 200% “hammer” if you ask early.

2) Limit holdover to base rent (or exclude certain add-ons)

If the lease says “150% of rent,” clarify what “rent” means:

is it base rent only?
does it include percentage rent, marketing fund, or other add-ons?

Tenant-friendly approach: holdover multiple applies to base rent only, and additional rent stays at actual cost.

3) Holdover is not a default if you comply

Try to convert holdover from “default” to a defined month-to-month structure if:

you continue paying holdover rent
you maintain insurance
you aren’t interfering with landlord’s planned work

4) Cap liability for third-party damages

Avoid open-ended “consequential damages” language. A practical middle ground is:

landlord can recover direct, documented damages caused by willful overstay
no liability for speculative or indirect damages

5) A written short-term extension option

If you’re buildout-heavy, ask for an “end-of-term extension option”:

tenant can extend 1–3 months at a defined rate (e.g., 110%–120%)
requires written notice
expires if landlord already signed a replacement tenant lease for your space

This reduces surprise and gives both parties planning clarity.

Operational steps to avoid accidental holdover

Holdover risk is often operational—not legal. A simple timeline helps:

90–120 days before lease end: confirm moveout date, start comparing vendors, confirm new space readiness.
60 days: schedule movers, IT cutover, signage removal, final inventory plan.
30 days: confirm utilities shutoff/transfer, insurance changes, key return process.
Final week: remove trade fixtures (as allowed), patch/paint if required, document condition with photos.

Make sure you understand the lease’s “surrender” requirements. Some leases define surrender as:

vacated premises
broom clean
keys returned
security systems removed
signage removed

If you miss any one of those, the landlord may claim you’re still holding over.

A simple extension request email (tenant script)

If you think you might need extra time, ask early and in writing:

Subject: Request for short-term lease extension (moveout logistics)

Hi [Landlord/PM Name] — we’re planning our moveout and want to avoid any disruption to your plans for the space. Can we agree to a short-term written extension through [date] on month-to-month terms at [rate], with all other lease terms continuing? If you can send a simple addendum, we can review and sign promptly.

Even if the landlord says no, asking early reduces the chance they treat a few extra days as hostile holdover.

How BizLeaseCheck helps

BizLeaseCheck flags holdover clauses and common traps like:

200% rent spikes
holdover treated as a default
broad “damages” language tied to replacement tenant delays
ambiguous definitions of “rent” (base vs additional)

Upload a lease for a fast first-pass review:

/analyze

Not legal advice

This article is for informational purposes only and is not legal advice. Holdover rights and remedies vary by lease language and jurisdiction. Use this as a checklist and confirm key terms with qualified professionals.