Works and Maintenance of Commercial Premises in the Balearics

Effective Date: 1 January 1995 (Ley 29/1994, de Arrendamientos Urbanos).

Managing maintenance and repairs for commercial premises in the Balearic Islands requires precise contractual allocation, especially given the high-corrosion coastal environment of Mallorca, Ibiza, and Formentera. Unlike residential leases, B2B agreements are primarily governed by the will of the parties.

1. Statutory Default: The Risk of Silence (Art. 30 LAU)

In the absence of specific contractual clauses, Article 30 of the Urban Leases Act (LAU) applies the maintenance regime of residential leases (Art. 21) to commercial premises. This obliges the landlord to perform all repairs necessary to maintain the property in a condition suitable for the commercial use agreed upon (Art. 21.1), without the right to increase the rent. The tenant is only responsible for "minor repairs" (pequeñas reparaciones) arising from ordinary wear and tear (Art. 21.4). In the Balearics, where salinity and humidity accelerate structural wear, failing to specify maintenance limits in the contract can lead to significant unexpected liabilities for the landlord.

2. Contractual Freedom and "Triple Net" (NNN) Clauses

Commercial leases for "use other than housing" are governed primarily by the agreement between the parties (Art. 4.3 LAU). Under the principle of contractual freedom (Art. 1255 Civil Code), it is standard practice in the Balearic Islands to implement "Triple Net" structures. These clauses contractually transfer the following burdens to the tenant, provided they are explicitly stated in the contract:

• Full Maintenance: 100% of conservation and repair costs, including structural elements.
• Operating Expenses: Community fees, property taxes (IBI), and insurance.
• Regulatory Compliance: Costs related to adapting the premises to municipal safety or health regulations specific to the tenant's business.

3. Tenant Improvements and Restoration (Art. 23 & 35 LAU)

Tenants must obtain express written consent for any works that modify the configuration of the premises (Art. 23.1 LAU). Unauthorized modifications grant the landlord the right to terminate the lease (Art. 35.1 LAU).

• Consent Requirement: Any structural change or configuration modification must be documented in writing.
• Restoration Rights: If unauthorized works compromise the building's stability or safety, the landlord can demand immediate restoration to the original state (Art. 23.2). For other configuration changes, the landlord may choose between terminating the contract or requiring the tenant to restore the premises at the end of the lease term.

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