Q: It would be easier for me to sign a new lease with one of my office building tenants that wants to renegotiate its existing lease, rather than amend the current one. This is the first time I’ve gone through the process. Is there a...
In a perfect commercial real estate world, shopping center and retail leases wouldn’t be subject to variables that could negatively affect your profitability. In reality, inflation—which is impossible to predict with complete certainty—can affect your bottom line unless you and...
If you’re unsure that a prospective tenant will be able to pay its rent, getting a guaranty can assuage your fears and protect you from not being able to collect what the tenant owes. While a tenant might be able to produce a third party who’s willing to act as a guarantor on the...
Q: I recently bought a building comprised of several commercial condo spaces. A restaurant tenant has expressed interest in one of the spaces, but I’m apprehensive. The space is subject to the governing documents of an association, and...
While many commercial leases are for several-year terms, it might behoove you to agree to a month-to-month tenancy with a tenant. Month-to-month tenants can be part of a strategic plan for your property, especially if you have spaces that you’d like to collect rent for in the short term...
Some office building or mall owners put out “wet floor” signs during rainy or snowy weather to warn customers about slippery conditions that could quickly develop on the floors of the property. In just a few minutes, water can collect, creating a hazard. It’s important to be...
Special considerations need to be addressed when a prospective tenant is not a U.S. business or individual. These considerations are geared to ensuring that the tenant and the guarantor, if any, have sufficient assets within the U.S., and that all...
Two of the most oft-cited reasons for seeking alternative dispute resolution (ADR)—specifically arbitration—as an alternative to litigation are the potential savings in time and costs to the parties, including the greater likelihood of final resolution due to the limited bases upon...
CRE owners should be aware of situations in which a license agreement may prove to be more beneficial than a leasehold interest. The key factors that distinguish a license from a lease are the ability to revoke the licensees’ use at will, and the degree of control that the property owner...
Rent acceleration clauses in commercial real estate leases are often the subject of contentious negotiations between the parties, and increasingly, the subject of review by courts when enforcement is challenged by tenants and guarantors.
While the terms of commercial leases will vary to some degree depending on the owners, tenants, and types of businesses involved, most of the same items are on the agenda for negotiations. Renewal or expansion options, common area maintenance exclusions, use clauses, and assignment and...
In a strong tenants’ market, you might find yourself fighting for good tenants that help the synergy at your center or serve as a destination spot that will draw and keep foot traffic. You may be forced to offer incentives, like a tenant improvement allowance (TIA) that’s bigger than...
