TÜRKIYE Law and Practice Contributed by: Serkan Gül, Nazım Kurt and Türkay Avanaş, Hergüner Bilgen Üçer Attorney Partnership
6. Commercial Leases 6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time Lease A lease is the basic type of arrangement that allows a person, company or other organisation to occupy and use real estate for a limited period of time without buying it outright. Right of Construction A right of construction may also be established as a type of right in rem in order to protect the owner’s right against third parties. In practice, a right of con - struction is preferable to other types of real estate use because it gives property rights to the holder of the right of construction for a period. A mortgage may also be established over a right of construction as it is independently registered in the title deed registry with separate ownership rights. Usufruct Another type of right in rem is the usufruct right, which entitles the right-holder to use and benefit from real property fully. The usufruct right is a right granted to a specific person and may not be transferred. It is a right that is limited in time; usufruct rights granted to legal persons are limited to 100 years, and usufruct rights granted to natural persons are limited to the grantee’s lifetime. 6.2 Types of Commercial Leases There are no different types of commercial leases. All lease agreements are governed by the same regula - tion. However, leases may be classified as a ground lease or a building lease according to the rental con - ditions. Currently, there are also ongoing discussions to amend the legislation regulating home leases and commercial leases, though there are no drafts avail - able yet. 6.3 Regulation of Rents or Lease Terms Rentals are freely negotiable under lease agreements. However, certain lease terms, such as eviction, rent increase, etc, are specifically regulated under the Turkish Code of Obligations as mandatory terms.
Turkish Code of Obligations The application of some of these mandatory terms was postponed for eight years when the Turkish Code of Obligations came into force on 1 July 2012 for mer - chants and private and public legal entities. As the eight-year period expired on 1 July 2020, these pro - visions became applicable to merchants and private and public legal entities as well. Such provisions are mostly considered to protect tenants against land - lords, and provide certain limitations with regard to the lease agreement. For instance, the most prominent ones stipulate that obligations regarding additional payments other than rent and ancillary costs cannot be imposed on tenants, and penalty clauses for fail - ure to pay and acceleration clauses will be deemed invalid. A piece of legislation enacted in 2018 prohibits denominating rental fees in foreign currency under certain conditions. This legislation applies to lease agreements where the lessor is a foreign capital company, but it is still possible to denominate rents in foreign currency in lease agreements where the ten - ant is a foreign real person, a foreign company, or a company owned by foreign investors. 6.4 Typical Terms of a Lease There is no minimum or maximum limit for lease terms. In practice, the terms of leases for residential property are generally agreed to as one year, compared to five years or more for commercial assets. The owner of the real estate should carry out the structural mainte - nance, while the lessee is responsible for daily main - tenance. Parties may contractually agree otherwise. The parties generally agree to the frequency of rental payments as a monthly payment, but the parties may also determine the term of rent as quarterly or annu - ally. In commercial leases, rent may be expressed as a fixed amount or as a fixed percentage of revenues derived from the use of the property. Market practice tends to combine the two, with payable rent being set at whichever of the two is higher. It is also customary to introduce force majeure clauses in lease agreements. Before the COVID-19 pandemic, most force majeure provisions addressed the risk of leased property being damaged by an act of God, in
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