How important are personal guarantees in commercial leasing?

Personal guarantees may provide additional financial assurance in certain leasing situations, particularly when leasing to newer businesses or privately held companies. The appropriateness of a personal guarantee depends upon the tenant’s financial strength, operating history, lease structure, and the owner’s risk tolerance.

Guarantees should be viewed as one component of an overall risk management strategy rather than the sole basis for approving a tenant.

Well-qualified tenants often demonstrate strength in multiple areas beyond financial guarantees alone.