Redmond Commercial Leasing Attorney

Redmond’s commercial lease market sits in a different position than Bellevue or Seattle right now. Vacancy is 17.6% at Q4 2025 (Broderick Group). The tightest on the Eastside. Microsoft renewed 396,000 square feet at Redmond Town Center in Q4 2025 and reoccupied 480,000 square feet at Millennium Corporate Park. That is not a market in retreat. Landlords in Overlake and downtown Redmond know it.

What does not change with vacancy: the legal baseline. SMC 6.104’s personal guaranty and security deposit caps are a Seattle ordinance. They stop at Seattle’s city line. A company moving from a Capitol Hill office to Overlake does not carry those protections. In Redmond, personal guaranties on commercial leases are uncapped under Washington state contract law. Every guaranty term, every deposit limit, every burn-down schedule has to be negotiated into the lease from zero.

The transit picture changed on March 28, 2026. The Crosslake Connection completed the full 2 Line. Downtown Redmond to Seattle’s International District is now approximately 41 minutes by rail. Downtown Redmond to Bellevue Downtown: approximately 19 minutes. That changes the workforce recruiting argument for tenants in both the downtown and Marymoor Village submarkets.

K&S Canon handles commercial lease negotiation and review for tenants and landlords throughout Redmond and King County. See our Redmond commercial real estate hub page for the full Redmond legal framework, including REET, entity formation, and commercial disputes.

Quick answer for Redmond commercial lease clients: SMC 6.104 guaranty and deposit caps do not apply in Redmond. Personal guaranties are uncapped under Washington state contract law. SSB 5840 (eff. June 6, 2024) eliminated the notary requirement for unrecorded commercial leases statewide. Redmond office vacancy: 17.6% Q4 2025 (Broderick Group). Downtown Redmond 2 Line to Seattle ID: approximately 41 minutes (opened March 28, 2026). Kim Sandher, JD, Washington Bar #42630. (206) 507-4009.

Does SMC 6.104 apply to commercial leases in Redmond?

Short answer: No. SMC 6.104 (Ordinance 126982, applies to new commercial leases executed after January 27, 2024; became law January 29, 2024) is a Seattle city ordinance. It applies only within Seattle city limits. In Redmond, personal guaranties and security deposits on commercial leases are uncapped and governed by Washington state contract law. There is no equivalent Redmond ordinance.

This is the starting point for every commercial lease negotiation K&S Canon handles for companies expanding from Seattle to Redmond. The protections that came with a Seattle lease do not follow the tenant east on SR 520. A Redmond landlord can ask for a full-term personal guaranty on a five-year lease. Whether they get it depends on the tenant’s credit, the vacancy in that submarket, and the negotiation. Not local law.

Redmond’s 17.6% vacancy (Q4 2025) is tighter than Bellevue (25.4%) and far tighter than downtown Seattle (35.6%). That means less inherent negotiating use here. A tenant who might extract a two-year burn-down from a Bellevue landlord with 25% vacancy faces a harder conversation with a Redmond landlord who has options. Knowing the market before the negotiation is the practical advantage.

For a five-year Redmond lease at $8,000 per month, uncapped exposure on a full-term guaranty is $480,000. A two-year burn-down cuts that to $192,000. That gap does not close by statute in Redmond. It closes by negotiation. Every lease is different.

Lease term	Seattle (SMC 6.104) vs. Redmond
Personal guaranty cap	Seattle: 2 years base rent + landlord TI. Redmond: none. Full-term exposure possible.
Security deposit cap	Seattle: first + last month base rent. Redmond: none. Negotiate from zero.
Guaranty burn-down	Seattle: built into cap structure. Redmond: must be drafted explicitly.
Private right of action	Seattle: yes. Redmond: N/A. No equivalent ordinance.
Notary for lease (SSB 5840)	Not required for unrecorded leases statewide (eff. June 6, 2024). Recorded leases still require notarization under RCW 64.04.010.

SSB 5840 (effective June 6, 2024) eliminated the notary requirement for commercial leases statewide. A Redmond commercial lease not intended for recording does not require notarization. A lease intended for recording still requires notarization under RCW 64.04.010.

 

What lease terms matter most for Redmond commercial tenants?

Short answer: Because Redmond has no statutory guaranty or deposit caps, every material term must be negotiated. The highest-risk terms are: the personal guaranty scope and burn-down; security deposit amount and release conditions; permitted use language (particularly in Downtown and Overlake TOD zones affected by the June 2025 zoning consolidation); redevelopment and demolition clauses in buildings near active TOD zones; and CAM charge structures in multi-tenant Redmond Town Center and Overlake buildings.

Personal guaranty

Redmond landlords, particularly in Overlake buildings close to the Microsoft campus, start from a strong position. Their target tenants are creditworthy tech companies and Microsoft vendors with real balance sheets. For those tenants, burn-down provisions and release triggers on assignment are achievable. For earlier-stage companies, the landlord may hold firm on a full-term guaranty unless the tenant can post a letter of credit or increase the security deposit in lieu of a longer guaranty period. None of this is automatic. K&S Canon negotiates these terms for Redmond commercial tenants across both the Overlake and downtown submarkets.

Permitted use and TOD zoning

Redmond’s June 28, 2025 zoning consolidation (Redmond 2050 Comprehensive Plan, Ordinances 3181 and 3220) reduced 12 Downtown zones to 3 and introduced new Urban Mixed-Use and TOD designations. Downtown Redmond now allows up to 12 stories in TOD areas. Overlake core allows up to 30 stories with height bonuses.

For commercial tenants, the practical implication: the lease’s permitted use clause should match what the tenant actually intends to operate under the zone in effect at signing. A use that was clearly permitted under a prior Downtown zone may have a different classification under the consolidated code. Buildings in transition zones, particularly near the Downtown Redmond Station and Marymoor Village Station, carry redevelopment risk during five-to-ten year lease terms. Leases in those areas should address demolition and redevelopment rights directly. Every lease is different.

CAM charges in Redmond

Redmond commercial buildings run a mix of gross, modified gross, and triple-net structures. In Redmond Town Center and the Overlake Microsoft-adjacent buildings, NNN leases with separate CAM reconciliations are common. Key negotiation points: whether CAM increases are capped annually, whether the tenant has audit rights, whether capital expenditures and management fees are excluded from the CAM pool, and how the tenant’s pro-rata share is calculated if major tenants (like Microsoft) vacate anchor space. The Microsoft reoccupation of Millennium Corporate Park is stabilizing that submarket. Any lease in a building with a dominant tech tenant should address what happens to CAM allocation if that anchor reduces its footprint.

Redmond’s no-B&O tax structure and lease economics

Redmond does not levy a city B&O tax. The city charges a per-employee business license fee: $160 per full-time equivalent employee working in Redmond in 2026. That is the only city-level gross revenue obligation. A Redmond company with 50 employees pays $8,000 per year to the city. A comparable Bellevue company with $5 million in annual local revenue and 10,000 square feet of office space would owe approximately $21,168 per year in Bellevue B&O taxes (gross receipts plus square footage). That difference belongs in every Redmond versus Bellevue lease economics comparison.

Lease term	Redmond starting position (no SMC 6.104)
Personal guaranty	Full-term by default. Negotiate: burn-down, cap, release on assignment.
Security deposit	No cap. Negotiate: amount, partial release milestones, full return timeline.
Permitted use	Must match current consolidated zone code. TOD zones near stations warrant specific review.
Redevelopment clause	Relevant near Downtown Redmond Station and Marymoor Village Station TOD areas. Negotiate: notice, conditions, relocation.
CAM caps	Not automatic. Negotiate: annual cap %, exclusions, audit rights, anchor-departure allocation.
B&O tax on lease economics	Redmond: none. $160/FTE business license fee only. Factor into total occupancy cost vs. Bellevue.

How does the 2 Line affect Redmond commercial leasing?

Short answer: Redmond now has four Sound Transit 2 Line stations: Overlake Village, Redmond Technology (Microsoft campus), Marymoor Village (opened May 10, 2025, 1,400-stall garage), and Downtown Redmond (opened May 10, 2025, terminal station). The Crosslake Connection opened March 28, 2026, completing the full 2 Line. Downtown Redmond to Seattle’s International District: approximately 41 minutes. Downtown Redmond to Bellevue Downtown: approximately 19 minutes. Redmond Technology Station to Bellevue Downtown: approximately 13 minutes.

Four stations serving different Redmond submarkets means transit access is not uniform across the city. Overlake Village and Redmond Technology stations serve the Microsoft campus corridor, the primary commercial demand driver in that submarket. Marymoor Village Station serves the southern residential and park-adjacent commercial area, with the 1,400-stall park-and-ride making it accessible to a wide commuter catchment. Downtown Redmond Station is the terminal, sitting elevated above 166th Avenue NE with direct pedestrian access to Redmond Town Center and City Hall.

For commercial lease negotiations, the transit story is now fully built out. Tenants recruiting employees anywhere along the 2 Line corridor (Lynnwood, Seattle, Bellevue, all four Redmond stations) can point to direct rail access. That is a workforce recruitment argument that Redmond’s commercial market did not have before May 2025.

2 Line station	Redmond submarket served
Overlake Village	SR 520 corridor; west Overlake commercial; proximity to Microsoft campus.
Redmond Technology	Microsoft One Microsoft Way campus boundary. Microsoft-funded pedestrian tunnel under NE 40th Street.
Marymoor Village	Opened May 10, 2025. 1,400-stall park-and-ride. Marymoor Park (640 acres). SE Redmond/Bear Creek industrial zone adjacent.
Downtown Redmond	Opened May 10, 2025. Terminal station. Elevated above 166th Ave NE. Walking distance to Redmond Town Center, City Hall.
Crosslake Connection	Opened March 28, 2026. Downtown Redmond to Seattle ID: ~41 min. Downtown Redmond to Bellevue Downtown: ~28 min.

What are the Redmond 2050 zoning changes and how do they affect commercial leases?

Short answer: The Redmond 2050 Comprehensive Plan (Ordinance 3181 (effective January 1, 2025) and Ordinance 3220 (effective June 28, 2025)) consolidated 12 Downtown zones into 3 and introduced Transit-Oriented Development (TOD) designations. Downtown TOD areas allow up to 12 stories. Overlake core allows up to 30 stories with height bonuses. Commercial tenants signing leases in buildings within these TOD zones should confirm permitted use under the current consolidated code and evaluate demolition and redevelopment clauses in their lease. A use permitted before the consolidation may face a different classification now.

The consolidation matters most for tenants in buildings that sit within or adjacent to the designated TOD zones around the four 2 Line stations. In the downtown submarket, the three consolidated zones replace 12 prior designations. A permitted use that was clearly categorized under a prior Downtown Commercial zone may now require confirmation under the Urban Mixed-Use or TOD designation that replaced it.

For lower-rise buildings near Downtown Redmond Station and Marymoor Village Station, the height bonuses in the new code create real redevelopment pressure. A landlord owning a two-story office building in a zone that now allows 12 stories has a zoning basis for pursuing higher-and-better-use development during any five-to-ten year lease term. Redevelopment and demolition clauses should be reviewed in any Redmond lease near these station areas. K&S Canon handles commercial lease review in the Downtown Redmond and Overlake TOD zones. Every lease is different.

Source: City of Redmond Zoning District Consolidation (redmond.gov/2106/Zoning-District-Consolidation) and Redmond 2050 Comprehensive Plan (redmond.gov).

 

Does the notary requirement apply to Redmond commercial leases?

Short answer: SSB 5840 (effective June 6, 2024) eliminated the notary requirement for commercial leases not intended for recording. A Redmond commercial lease that will not be recorded does not require notarization. A lease or memorandum of lease intended for recording at King County Recorder still requires notarized signatures under RCW 64.04.010. The King County Recorder’s Office at 201 S. Jackson Street, Suite 204, Seattle closes for recording at 3:30 pm, a hard deadline on every Redmond closing.

Before SSB 5840, Washington required landlord signature acknowledgment (notarization) on commercial leases longer than one year. Failure to notarize could reduce a multi-year lease to a month-to-month tenancy as a matter of enforceability. SSB 5840 eliminated that exposure for unrecorded leases. For Redmond commercial leases not intended for recording (the majority) notarization is no longer a baseline execution requirement.

The exception applies where recording matters: a lease exceeding one year that a tenant wants to record against the property (for constructive notice against subsequent purchasers or lenders) still requires notarized signatures under RCW 64.04.010. If a memorandum of lease will be recorded at the King County Recorder, both landlord and tenant signatures must be notarized before the filing.

 

Who signs a commercial lease for a Washington LLC in Redmond?

Short answer: In a member-managed LLC (the default under RCW 25.15.101), each member has authority to bind the LLC under RCW 25.15.151. In a manager-managed LLC, managers have authority under RCW 25.15.154 and members generally do not. Redmond landlords require the operating agreement and a Washington Secretary of State certificate of good standing. Because SMC 6.104 does not apply in Redmond, the operating agreement should also specify what approval is required before any principal executes an uncapped personal guaranty. Every entity is different.

Redmond’s tech-heavy commercial tenant base includes a high proportion of Microsoft vendors, AI startups, and early-stage software companies forming entities quickly to enter their first commercial lease in Overlake or downtown. Signing authority questions arise when a founder signs a lease without the balance of the membership having approved it, or when the operating agreement is silent on real property commitments.

Because Redmond commercial leases carry uncapped personal guaranties, the operating agreement’s governance provisions are especially important. A startup founder signing a five-year uncapped personal guaranty without the operating agreement requiring approval from co-founders has created personal exposure the entity structure was supposed to limit. Addressing that before lease execution, not after, is the practical approach.

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