Feature

How to Negotiate and Structure a Workout with Tenants in Default

July 20, 2022    
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...
Drafting Tips

Lease Guaranty vs. Suretyship: What's the Difference & Why It Matters

July 20, 2022    
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’s...
Pop Quiz

Did Landlord and Tenant Orally Modify the Lease?

July 20, 2022    
As many of us learned during the COVID-19 pandemic, it’s not uncommon for landlords and tenants to revise their lease terms on the fly in response to changing conditions. The general rule is that it’s okay to revise a written lease, provided that those changes are themselves put in...
Owner Loses

Leaving Equipment Behind for 24 Hours Isn’t a Holdover

July 20, 2022    
What Happened: After a mutually beneficial tenancy of over two decades, Comcast moved out of its Michigan corporate headquarters. The move didn’t go exactly as planned, and the company was unable to remove equipment from its in-house fitness center by the lease termination date. Comcast had...
Owner Wins

OK to Evict Shopping Center Tenant for Creating a Nuisance Without Opportunity to Cure

July 20, 2022    
What Happened: Shopping center tenants complained to the landlord about the “overwhelming unpleasant possibly toxic odors” emanating from their neighboring bar lounge tenant whose patrons were apparently allowed to smoke tobacco and marijuana with impunity. The landlord warned the...
Owner Wins

Landlord Can Collect Rent from Defaulting Tenant After Selling the Property

July 20, 2022    
What Happened: In 2019, a clothing store signed a 10-year lease on commercial property in Chicago, starting in September 2020. But the COVID-19 pandemic hit and the tenant never moved in. In May 2021, the landlord sold the building and terminated the lease. In addition to $1.4 million in unpaid...
Feature

Get 10 Legal Protections When Giving Tenants a Right of First Offer

June 23, 2022    
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. One way to...
Dos & Don'ts

Don't Use 'To Code' as Sole Work Letter Standard

June 23, 2022    
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,...
Dos & Don'ts

Consider Seeking Lower Tax Assessment If Tenant Pays Below-Market Rent

June 23, 2022    
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...
Owner Loses

Bankrupt Tenant Can Renew Lease Despite Defective Renewal Notice

June 23, 2022    
What Happened: A restaurant tenant with a habit of paying rent late took advantage of the COVID-19 shutdown to make some improvements to the space at its own expense, assuming that it would be able to renew once the lease came to an end in August 2021. But the tenant was still in big-time arrears...