Feature

Get 7 Lease Protections When Making Tenant Responsible for HVAC Maintenance

September 23, 2022    
It costs a lot of money to maintain a heating, ventilating, and air conditioning (HVAC) system. There’s also a lot at stake. Keeping the HVAC system humming is crucial to maintaining comfort, ensuring air quality, and, in some cases, preserving tenants’ stored inventory. Accordingly,...
Negotiating Tips

How to Deal with Retail Tenant's Demand to Exclude Bad Debts from Gross Sales

September 23, 2022    
When negotiating a percentage rent lease, don’t be surprised if a retail tenant demands that you exclude bad debts from the formula for calculating gross sales. This is hardly an unreasonable demand. After all, why should the tenant have to pay percentage rent on customer receivables that it...
Pop Quiz

Can Tenants Sue Landlords for Environmental Violations Affecting Leased Property?

September 23, 2022    
Suppose a landlord commits a serious violation of environmental laws that renders leased property unsafe for tenants to occupy. What legal remedies would the tenant have against the landlord? Here’s a scenario based on a recent federal case from Pennsylvania that sheds some light on this...
Owner Loses

Lease Doesn't Make Tenant Responsible for Real Estate Tax Increases

September 23, 2022    
What Happened: A nonprofit landlord leased property to a for-profit utility to operate a solar-powered electric-generating facility. The lease required the tenant to:
Owner Wins

Guarantor on the Hook for Landlord's Consequential Damages

September 23, 2022    
What Happened: A landlord sued Saks, Inc., for failure to honor a corporate guaranty of its subsidiary’s obligation to pay rent under its shopping center lease. Saks owes us attorneys’ fees and consequential damages covering the loss in the property’s value we suffered due to its...
Owner Wins

NYC Landlord Not Guilty of Harassing Nonpaying Tenant

September 23, 2022    
What Happened: In May 2020, with the pandemic in full rage, New York City adopted a law banning commercial landlords from harassing tenants. A bridal shop tenant invoked the law after the landlord sued it and its guarantor for unpaid rent and additional rent for real estate tax and utilities cost...
Feature

Get 12 Lease Protections When Allowing Tenants to Keep Pets at Your Property

August 29, 2022    
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 that I came...
Drafting Tips

Ensure Percentage Rent Flow When Tenant Assigns or Sublets

August 29, 2022    
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...
Plugging Loopholes

Keep Guarantor Liable for Tenant’s Renewal and Holdover Defaults

August 29, 2022    
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 during...
Owner Loses

Shopping Center Co-Tenancy Rent Abatement Isn’t an Unenforceable Penalty

August 29, 2022    
What Happened: A shopping center tenant exercised its supposed right to pay reduced rent under a co-tenancy clause that kicked in when either: (1) the center lacked either three anchor tenants; or (2) 60 percent of the space wasn’t leased. While acknowledging that a trigger condition had...