Lately, it has become fashionable for some property owners to call their standard occupancy agreements licenses rather than leases. Perhaps the document will also contain a recital, buried among the assorted “boiler plate” provisions, that the parties intend to create a license rather than a lease. And the parties are called “Licensor” and “Licensee,” rather than “Landlord” and “Tenant.” Otherwise, except perhaps for some carefully selected deletions, the document virtually is indistinguishable from a typical lease.
In theory, a lease both grants a real property interest in the occupied premises and contains contractual terms between the landlord and tenant. A license similarly contains contractual terms upon which the licensor is allowed to use space, but without granting a real property interest to the licensee. Consequently, a license is thought to be less protective of the space user’s interests, and thus more desirable to the property owner, than a lease.
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