AS-IS

In a commercial lease, does “as is” really mean that the tenant takes the premises “as is”?  Even though that may be the intention of the parties, there may be laws that preclude a landlord from completely passing the buck on certain issues, such as environmental cleanup and hazardous waste.  Also, the law sometimes requires mandatory disclosure of defective conditions or other problems with the premises or property.

We are are to help you and your clients with all aspects of commercial property management. Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.

LAWSUIT INSURANCE

Besides insuring a property for destruction caused by natural disasters, a landlord should insure a property against lawsuits brought by a tenant. If a landlord illegally evicts a tenant, makes an illegal entry, or if a tenant or a person legally on the premises is injured because of a dangerous condition, insurance will cover the cost of litigation and will pay the damage award, if any. Landlords could possibly be sued by a tenant for many reasons. Inadequate insurance on a property can be costly.

We are here to help you and your clients with all aspects of commercial management. Please contact us for further assistance.

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.

COMMERCIAL LEASE COMPLIANCE

The "Compliance with Laws" provision of a commercial lease typically requires the tenant to perform potentially expensive replacements, alterations, or improvements of the leased premises.  It may require the tenant to comply with existing or future laws relating to the leased premises such as earthquake retrofitting, asbestos abatement, or compliance with the Americans with Disabilities Act.  In some instances the landlord agrees to bear the burden of compliance with these laws. If the tenant is to be responsible for compliance with laws, the landlord should represent and warrant to the tenant in the lease that the building is in compliance with all presently existing laws.  A tenant should try and place a cap on its annual exposure to this provision.

We are here to help you and your clients with all aspects of commercial property management.  Please contact us for further assistance.

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.

"Repairs and Maintenance"

A landlord and tenant must pay particular attention to the "Repairs and Maintenance" provision of a commercial lease.  Landlords may try and to this provision to require the tenant to repair and maintain areas located outside the leased premises.  A typical commercial lease will define tenant's repair and maintenance obligations with reference only to the interior of the premises.  However, depending on the definition of the premises, this may result in the tenant having to repair and maintain such things as fire sprinklers, heating and cooling ducts, and the building’s structural elements.  It is important that the lease be specific about who is responsible for the repair and maintenance of specific items so that there is no doubt as to which party has responsibility.

 We are here to help you and your clients with all aspects of commercial property management.  Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.

What Is Damage And Destruction?

The Damage and Destruction provision in a lease specifies what will happen if the leased premises or the building housing the leased premises is damaged or destroyed.  It typically provides that the landlord may elect, in its sole discretion, to continue the lease or to terminate it.  In the case of continuation, it usually provides for an abatement of rent (reduction) in the same proportion that tenant's use of the leased premises is impaired.  

The tenant must make sure that the abatement of rent language is fair.  Some leases base it on the amount of square footage of the leased premises that is damaged or destroyed.  This is unfair since sometimes the entire leased premises may not be useable even when the damage is to a small area.  For example, if the entry is blocked, it does not matter if the rest of the premises is not damaged; no one can enter.  In the case it landlord's responsibility to repair damage, make sure the tenant retains the right to complete improvements following the landlord's repair or reconstruction before rent obligation resumes. 

 We are here to help you and your clients with all aspects of commercial property management.  Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters

Termination, Relocation or Expansion Rights

One of the pitfalls for a commercial tenant regarding their lease is the "Termination, Relocation or Expansion Rights" provision.  Although reading a commercial lease can be difficult and time-consuming, the consequences of not reading can be more unpleasant or potentially disastrous.  A tenant who has not had their lease carefully read may be surprised to learn that the landlord has reserved the right to unilaterally terminate the lease or relocate the tenant.  An expansion provision may give another tenant the right to expand into the tenant's premises and/or may allow the landlord to terminate the tenant's lease.  Ideally, a tenant should not agree to such clauses. 

We are here to help you and your clients with all aspects of commercial property management.  Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.

LIABILITY - THE SLIP & FALL ISSUE

Some of the top legal/liability issues impacting landlords and commercial property managers include debt collection and frivolous lawsuits.  "Slip-and-fall" accidents and frivolous lawsuits rank high in top causes of disputes.  Some suggest that the economy has lead more people to try to cash in on slips and falls.  As in debt collection, it is beneficial for a landlord to have a properly trained property manager to handle these type of issues.

We are here to help you and your clients with all aspects of the Commercial rental market. Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.

 

INCREASE INVESTMENT VALUE

Did you know that commercial property management services could increase the value of your investment?  Preventative maintenance is achieved by putting systems in place that catch and deal with maintenance and repair issues early on, before they grow into larger more costly problems.  A quality maintenance plan requires a written maintenance check program, coupled with detailed maintenance documentation and regular maintenance visits.  The management firm can also offer suggestions and feedback regarding upgrades and modifications, both how they will affect the rent you can charge, as well as their impact on maintenance and insurance.

We are here to help you and your clients with all aspects of the commercial rental market. Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.

WHO NEEDS TO SIGN A COMMERCIAL LEASE?

Just as in other legal contracts, corporate authority and the enforceability of the signatories must be considered when negotiating a lease.  The question of who must sign a lease in order for it to be enforceable is a question of state law and the terms of the governing documents of the business leasing the rental.  Unless a tenant can provide proof that the person signing the lease is in fact authorized to do so by proper action, a landlord is at risk of a claim that the lease was not dully authorized and is therefore not binding.

It is also important to confirm that the tenant entity is in good standing in the state where it was formed and is qualified to do business in the state in which the premises are located. Commercial Property Management is just a click our call away!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.

TRIPLE NET - WHAT IS IT?

What does NNN (Triple Net) mean in commercial leasing?

In commercial leasing rents are often quoted as being NNN or Triple Net.  In a Triple Net lease, in addition to the quoted rental rate, the tenant is responsible for a specified percentage of the operating expenses and real estate taxes associated with the property.

NNN refers to Maintenance, Insurance and Taxes.  Maintenance generally covers the maintenance of the property, including landscaping, common area utilities and property management.  Because different landlords might include or exclude certain expenses from their definition of NNN, it is important to ask the for a specific list of included expenses in order to be able to accurately predict operating expenses.  

We are here to help you and your clients with all aspects of commercial property management.  Please contact us for further assistance.

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should obtain the advice of an attorney well versed in these matters.