Dos & Don'ts

Don't Share Profits with Tenant Whose Space Has Been Recaptured

December 16, 2016    

When negotiating your leases, you may want to include a recapture right that you can exercise if the tenant intends to assign its lease or sublet all or part of its space. And you may want to include a profit-sharing clause that will require the tenant to pay all or part of any profit it makes...

Don't Give Tenant Consent Right to Change Unit Number

December 16, 2016    

If a tenant wants you to specify the number of its unit, store, or suite in the lease, then say in the lease that the tenant’s unit, store, or suite is “presently known as [insert Unit/Store/Suite number, e.g., 4B]. The phrase “presently known as” will...

Don't Use Latin Phrases in Lease

December 16, 2016    

Avoid using Latin phrases—such as, ipso facto and inter alia—in your leases. Instead, use English words that mean the same thing. For instance, instead of saying “ipso facto,” say “of itself” or “by the mere fact.” And instead of saying “...

Don't Waste Money Proving that You Have Remedies

December 16, 2016    

When listing your remedies in a lease clause—for example, the option to terminate the tenant’s lease if the tenant stops operating its business—always start with the phrase: “In addition to any other rights and remedies available to Landlord under this Lease or at law or...

Don't Describe Termination Right Tied to Specific Event as 'Ongoing'

November 22, 2016    

Be careful how you describe the termination right you give a tenant. If you grant the tenant a right to terminate its lease in the event its business is sold, for example, make sure the tenant is required to exercise that right within a specific time period of the sale date. Consider what...

Don't Use 'Including' Unless You Define It in Lease

October 21, 2016    

It’s common in most leases to end a list of items with the phrase “including, without limitation,” or “including, but not limited to.” Those phrases are meant to indicate that the list isn’t exhaustive. But if you forget to use them consistently throughout the...

Pass Through Off-Site Traffic Improvement Costs to Tenants

October 21, 2016    

If, like many shopping center owners, you provide off-site traffic improvements for your tenants, you should make sure that you’re compensated for that. After all, these improvements—for example, special signage and lighting in areas leading to the property or a way to control the...

Don't Let Non-Lease Tenant Decide When to Give Notice

August 29, 2016    

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...

Determine Obligation for Weather Hazard Warning

August 29, 2016    

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...

Don't Make Handwritten Corrections to Lease Documents

August 11, 2015    

Sometimes a clerical mistake, such as an incorrect date or a misspelled name, is made on a lease document. But if the mistake isn’t caught and corrected, it can lead to a dispute later between you and your tenant—especially if the...

Don't Make Blatantly Unfair Requests During Negotiations

August 11, 2015    

You may have a “wish list” for items you would like to include in your lease with a prospective tenant, but be careful not to overdo it. Big box tenants or those with a lot of bargaining power are more likely to balk at requests for...

Don't Rely on Implied Continuous Operations Covenant

August 11, 2015    

Don’t rely on an “implied” continuous operations covenant—that is, one that isn’t expressly stated in the lease—if you want your retail tenant to continuously operate from its space. Some courts might find that...

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