Pet rules in a commercial lease? At first, I thought this was a terrible idea for an article. After all, the vast majority of commercial landlords in the U.S. don’t permit pets on the property—to the extent they even consider the issue at all. And it was for that very reason...
Percentage rent is typically based on the gross sales generated from the leased space rather than a tenant’s gross sales. So, an assignment or sublet by a tenant with strong sales to a business with weaker sales could take a significant bite out of percentage rent. You could even end up...
In many states, the lease guaranty ends when the underlying lease ends. So, unless there’s language to the contrary, the guarantor is off the hook if the tenant holds over after the end of the term or renews the lease. That leaves you holding the bag for any tenant defaults that occur...
With a recession looming, commercial landlords and tenants may once again need to exhibit the flexibility they displayed to get through the COVID-19 pandemic. While helping tenants meet their rent obligations will be the first-choice approach, landlords also need to be prepared in case tenants...
There are some tenants that you know will have the assets necessary to pay their rent every month. And then there are the more financially risky ones. When leasing to these businesses, it’s advisable to get a more financially stable third party to sign an agreement backing the tenant...
Offering ROFOs is a great way to attract flourishing businesses. But it comes at a price.
Moving to a different building can be costly and disruptive. Accordingly, tenants that are growing rapidly may seek rights to expand within the building in case they run out of space...
When negotiating the terms of a work letter with a tenant, don’t just agree to do a particular item of work “to code,” without listing any specifics or limitations. When not properly defined or limited, the phrase “to code” can be the source of confusion,...
In these tough times, landlords need to find ways to turn lemons into lemonade. One example is considering whether the lemon of the tenant who’s paying below-market rent might yield sweet lemonade in the form of a reduction in your property tax assessment. This recipe has worked for many...
As retail and restaurant businesses contract and struggle to survive, many shopping center tenants are looking for ways to get out of their leases. One common exit strategy is for tenants to assign their lease interest or sublease some or all of the leased space to a third party. Tenants are...
Here’s a four-phase strategy for drafting a lease amendment letting a tenant contract its space.
In a post-pandemic world where a greater volume of work and business will be carried out remotely, many tenants will need the flexibility to not only expand but also...
The COVID-19 pandemic has illustrated the need for landlords and tenants to be flexible and work together to find solutions to leases that have become disadvantageous. One approach is to enter into a buy-out agreement allowing the tenant to end the lease early in exchange for an agreed-to sum of...
Even before the pandemic, shopping center tenants were insisting on the right to terminate their lease in the event the anchor tenant leaves. Giving in to these demands may be unavoidable when tenants are a part of a national chain or otherwise enjoy negotiating leverage. But you should also...
