Feature

RSS

If you’re not careful when drafting your lease with a tenant that wants to customize its space with a large-scale installation, you could be left footing the bill for removing it after the tenant moves out. But there is a leasing strategy you can use to make your space more marketable and lower your costs when the tenant moves out. And because the strategy has benefits for the tenant, too, unlike with some of your other requests during lease negotiations, you prob...

As mixed-use commercial properties have become prolific over the last few years, office building owners have had to get used to the idea of leasing space to retail tenants in buildings that traditionally might’ve been used strictly as office space.

Despite an uptick in the commercial real estate market, many owners are still trying to fill vacant space. There isn’t an endless supply of big-box tenants to fill large vacant space, so when previously reliable chains like Blockbuster and Circuit City began moving out of their spaces, many shopping center owners were left with spaces designed to accommodate expansive businesses—but no similar-sized tenants to replace them.

If you own a shopping center or office building long enough, an accident involving a shopper or visitor to the property will inevitably happen. Accidents can be a nightmare for owners: In the best-case scenario, you’ll have to deal with a situation that forces you to spend time consulting with your attorney and worrying about a lawsuit that never happens. In the worst-case scenario, you’ll end up defending yourself from a negligence lawsuit. You can avoid li...

If you’re like many shopping center owners, the leases with your tenants include “percentage rent” provisions that require them to pay you a percentage of their gross sales. As long as gross sales are high, you’ll benefit from a percentage rent arrangement. If a tenant’s competitor in a nearby shopping center draws business away from the tenant and your center, your percentage rent could decrease. And to some degree that’s unavoidable.

In the past, utility costs have been the impetus for owners to encourage their tenants to conserve energy while operating their businesses. But in recent years, environmental concerns have compounded many owners’ concerns about tenants using excessive amounts of energy once they move into the space they’ve leased—especially if the owner will be paying for a significant amount (or all) of the cost.

Traditionally, common area maintenance (CAM) costs are calculated based on an estimate of what a shopping center’s CAM costs will be for the year, and the tenant pays a proportionate share of those costs. At the end of the year, the tenant’s payments are reconciled with the center’s actual CAM costs.

When you need to find a contractor for a major project at your center, such as an ongoing job like landscaping, or a one-time job like replacing roofs, don’t simply hire the first available contractor you can find. Instead, prepare a request-for-proposal (RFP) to solicit bids from multiple contractors. But be specific when drafting your RFP.

When the terms of a lease are negotiated carefully—and complied with—leasing can be the most profitable and efficient use of your commercial space. And you might think that a traditional commercial lease is the only option available to you. But a lease isn’t as appropriate for certain types of tenants as a “license agreement” is. Some tenants—such as “on-demand” temporary office space providers, certain types of storage sp...

What exactly are license agreements and how can they be beneficial to owners? When you sign a lease with a tenant it creates a landlord-tenant relationship that can work in your favor, but also comes with some potential problems. For example, when a tenant defaults on its lease owners usually don’t have the option of terminating the lease immediately. The owner might have to wait a certain period of time for the tenant to “cure”—that is, fix&mdas...