further, if drafted correctly, a landlord has sufficient time to find a new tenant if the option is not exercised. options are governed by the contract terms established by the parties and documented in a lease or option agreement. an option to extend or renew is treated as a continuing offer by the landlord which must be exercised. a lease agreement should clearly spell out the means by which an option may be exercised. for example, how far in advance must a tenant provide notice to a landlord? a lease should make clear whether a tenant has the option to either “extend” or “renew” the lease.