Oregon Commercial Security Deposit Laws

Oregon's strict residential security deposit rules—31-day return, trust account, double penalties—do not apply to commercial leases. Commercial security deposits are governed entirely by the terms of the lease agreement.

Disclaimer: This guide provides general legal information for educational purposes only and does not constitute legal advice. Always consult a licensed attorney in Oregon for advice specific to your situation. Information last verified: March 2026.

No Statutory Cap

Oregon does not limit the amount a commercial landlord can request as a security deposit. The amount is negotiated between the parties, commonly ranging from one to six months' rent.

No Trust Account Requirement

Unlike residential deposits (which must be held in a separate trust account), commercial deposits have no such requirement. The landlord may hold the deposit in any account or commingle it with operating funds unless the lease specifies otherwise.

No Statutory Return Deadline

There is no "31-day rule" for commercial deposits. The return timeline must be defined in the lease, with common periods ranging from 30 to 90 days after the tenant vacates.

Letters of Credit and Bank Guarantees

For larger commercial tenants, landlords often accept a Letter of Credit (LOC) or bank guarantee instead of a cash deposit. These instruments provide greater financial security and are standard in Oregon's commercial real estate market.

Best Practices

1. Define Everything in the Lease: Amount, holding method, return timeline, and allowable deductions must all be explicitly stated.
2. Conduct Thorough Inspections: Perform detailed move-in and move-out inspections with photographs.

How Landager Can Help

Landager tracks commercial deposits, LOCs, and bank guarantees across your Oregon portfolio, with automated alerts for return deadlines defined in each lease.

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