How to Lease a Commercial Space in Colombia: Legal Guide and Commercial Code

Quick answer: Renting a commercial space in Colombia is not governed by Housing Law 820, but by the strict Commercial Code (Articles 518 to 524). The golden rule that every owner must know is that, after 2 consecutive years with the same business establishment, the tenant acquires a right to renewal subject to the exceptions of Article 518. Eviction notice at least 6 months in advance applies when the owner invokes reasons 2 or 3 of that article.

If you have a commercial space in El Poblado, a warehouse in Paloquemao, or an office in Chapinero, you know that the commercial sector can be much more profitable than residential property. Tenants tend to be stable and renovations are at their expense. However, legally it is terrain where many owners make costly mistakes. If you want to see real options right now, you can view apartments and houses on Colombia Move — posting is completely free.

Honestly, if you are going to rent a commercial space, you cannot use the same contract format you used for your apartment. Here I explain exactly what the Commercial Code says and how to protect your investment.

1. Commercial Code vs. Law 820: The Big Difference

The most common mistake for beginner owners is believing that all rentals in Colombia work the same way. Law 820 of 2003 applies exclusively to urban housing. Commercial spaces, offices, and warehouses are governed by Articles 518 to 524 of the Commercial Code (Decree 410 of 1971).

Why this difference? Because commercial law seeks to protect the "goodwill" or the clientele that a business has built at a physical location over time. The rules are mandatory, which means you cannot skip them even if you include a clause in the contract that says otherwise.

According to active listings on Colombia Move (July 2026), there are currently 9 active listings between offices and commercial spaces. It is a time to showcase your property well, but you must do it with the appropriate legal protection.

2. The Right of Renewal (Article 518): The 2-Year Milestone

Article 518 is the heart of commercial leasing in Colombia. It establishes that, once the tenant has occupied the space for two consecutive years with the same business establishment, they acquire the right to renew the contract, subject to the exceptions provided in Article 518.

As an owner, you can only refuse to renew the contract in three specific situations (legal grounds):

• Non-compliance: If the tenant fails to pay the rent, utilities, or breaches other contract clauses.
• Own need: If you need the space for your own housing or to set up a business of your own that is substantially different from the one the tenant had.
• Reconstruction or demolition: If the property must be demolished, requires major repairs that cannot be done while the space is occupied, or for new construction.

I would skip any attempt to invent excuses to get a commercial tenant out. If you don't fit into one of these three grounds, you are obligated to renew.

3. Commercial Eviction Notice (Article 520): The 6-Month Golden Rule

If you meet the grounds 2 or 3 mentioned above and want to recover your space, you must carry out the "eviction notice" (desahucio). Article 520 requires that you notify the tenant in writing with no less than 6 months' advance notice before the contract expiration date.

Watch out for this: when you invoke grounds 2 or 3 of Article 518, if you do not give the notice at least six months in advance, the contract will be considered renewed under the same conditions and for the same term, according to Article 520. If you get the timing wrong, terminating a lease contract early becomes a huge legal and financial headache.

Make sure to send the notification by certified mail to have legal proof of the date of delivery and receipt.

4. Fixing Rent and Disputes (Article 519)

A frequent question is: "If the tenant has the right to renew, can they force me to keep the same price?". The answer is no.

Unlike the rent increase rules for housing, where the government sets a maximum cap based on the CPI (IPC), in commercial spaces the increase is governed by free agreement between the parties. If at the time of renewal they cannot agree on the new rent, Article 519 establishes that the difference will be decided judicially through a verbal process, with the intervention of appraisal experts.

In practice, almost no one wants to end up in court, so it is ideal to establish from day one in the contract how annual increases will be calculated (for example, CPI + 3 points, or a fixed percentage).

5. Subletting and Assignment (Article 523)

Another point where the Commercial Code surprises owners is subletting. According to Article 523, the tenant has the right to sublet up to 50% of the space without needing your prior authorization, provided it does not substantially alter the commercial purpose of the property.

However, to sublet the entire space or assign the contract to a third party, it does require your express and written authorization. Make sure to make this very clear in the original contract to avoid your space ending up in the hands of strangers without your security filter.

6. Practical Tips for Owners when Drafting the Contract

To close, here are three practical steps you must take before handing over the keys to your commercial property:

• Verify land use (POT): Before signing, make sure the tenant's commercial activity is permitted in your area according to the Territorial Planning Plan (POT). If they shut down their business due to improper use, they will stop paying you.
• Demand solid commercial guarantees: Unlike housing, security deposits are legal and very common in commercial leases. You can demand insurance policies, joint debtors, or cash deposits to cover potential damage to the property after heavy renovations.
• Register the contract: Although it is optional, registering the lease contract at the local Chamber of Commerce legally protects the establishment and formalizes the commercial relationship in front of third parties.

Frequently asked questions

❓ What law governs commercial space lease contracts in Colombia?

Commercial property lease agreements are strictly regulated by the Commercial Code (Articles 518 to 524), not by Law 820 of 2003. The latter applies solely and exclusively to urban residential leases, so its rules do not apply to businesses.

❓ When does the tenant acquire the right to renew the contract?

The tenant acquires the right to renew after occupying the property for two consecutive years with the same commercial establishment. According to Article 518, this is not an automatic or unconditional extension: the landlord may refuse if there is a breach of contract, if they need the property for their own housing or a substantially different business, or if the property needs to be vacated for reconstruction, necessary repairs, demolition, or new construction.

❓ When does the six-month eviction notice apply?

The six-month notice applies when the landlord invokes the reasons under subsections 2 or 3 of Article 518. According to Article 520, the landlord must notify the tenant at least six months before the expiration date; if this notice is omitted in those cases, the contract is considered renewed under the same conditions and for the same term.

❓ Is it legal to charge a security deposit for a commercial lease in Colombia?

Yes, cash security deposits are legal and common in commercial leases. Unlike residential contracts, where Law 820 restricts cash deposits, there is freedom to agree upon these guarantees in commercial properties.

❓ Can the tenant sublease the commercial space without my authorization?

Article 523 allows the tenant to sublease up to 50% of the space without your authorization, provided they do not change the commercial activity. To sublease 100% or assign the contract, they require your express written consent.

❓ What happens if we cannot agree on the rent increase during the renewal?

According to Article 519, the dispute must be resolved by a judge through a verbal process with the involvement of expert appraisers. Since there is no government-set cap on rent increases for commercial properties, it is advisable to agree upon an adjustment mechanism from the start.