What is the purpose of a "lease extension"?

The purpose of a lease extension is to prolong the duration of a lease beyond its original term. A lease agreement typically has a specified duration, and when the parties involved wish to continue the lease for an additional time period, they execute a lease extension. This document modifies the original lease to extend the terms and conditions agreed upon by both parties, allowing the tenant to continue occupying the leased property and the landlord to retain their tenant for a longer period.

This practice is beneficial for both landlords and tenants, as it provides continuity and certainty in leasing arrangements. The extension can be structured to maintain the same terms as the original lease or include negotiations on aspects like rental rate adjustments.

In contrast, creating a completely new lease agreement is a different action that entails drafting an entirely fresh document rather than just extending the existing terms. Reducing the existing rent charges does not necessarily pertain to extending a lease; rather, it would typically require a separate negotiation. Additionally, changing the ownership structure of the lease involves more fundamental changes to the lease's legal and operational framework, which is also not the objective of a lease extension.