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Grudges are part of any personal or business relationships. It’s a lesson that most landlords learn when tenants bring or threaten lawsuits over old grievances in a bid to get out of their lease, stall an eviction, or otherwise increase their leverage over you in a current dispute. Defending yourself against ancient claims isn’t easy. Memories fade, witnesses disappear, and documents vanish into oblivion. That’s why you should give serious thought to l...

Unlike so many other aspects of the commercial leasing business, methods of paying rent haven’t changed all that much over the years. The majority of tenants still mail out their monthly checks to the landlord. However, a growing number of businesses prefer to remit their rent electronically using ACH or wire transfer. Agreeing to electronic transfer of rent can be a win-win, provided that you get the right lease protections, advises a seasoned New York City leasi...

In these hard economic times in which so many businesses are being forced to shut down, it’s not unusual for commercial tenants to vacate their leased space without warning and leave all of their personal property and furnishings behind. In addition to losing a tenancy, landlords then face the expense of removing the property and preparing the space for the next tenant. However, it doesn’t necessarily have to be this way. As the saying goes, one person&rsquo...

It’s a common scenario that’s likely to arise any time a landlord hires outside contractors to carry out substantial improvements on a tenant’s premises: The tenant requests that the landlord “transfer” any construction warranties that the tradespeople may have given the landlord. The idea behind the request is to ensure that the tenant can call upon the tradespersons who performed the work for the landlord to resolve any defect, substandar...

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 collecting only minimum rent if the assignee or subtenant’s gross sales fall below the percentage rent breakpoint.

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 lease obligations and allowing you to hold it liable in case the tenant defaults. In the business vernacular, such agreements are generally lumped together under the term &ldq...

Chances are, your standard lease form includes one or more provisions requiring the tenant to exercise some kind of “efforts” to achieve a desired but uncertain result or outcome.

Waiving consent rights doesn’t necessarily require ceding all control.

Leasing to franchise businesses can ensure a stream of large, financially stable, and nationally recognized tenants. But it also poses unique leasing challenges. To leverage the full strength of the franchise, you want to lease directly to the franchisor and allow it to assign the lease or sublet the premises to the franchisee.

Death and taxes aren’t the only certainties in life. So are rises in the costs of operating commercial property. That’s why landlords generally require tenants to pay their share of operating expenses. And while most tenants are willing to go along with this arrangement, some might insist on limits, like a cap on increases or the overall pass-through amount. During these troubled times, you may have to agree to this demand, especially if the ten...

Can a tenant who can’t operate due to a COVID-19 public health emergency order rely on the force majeure clause of its lease to forgive its obligation to pay rent?

This has been perhaps the biggest question in all of commercial leasing law ever since the pandemic began. And now for the first time, a court has actually addressed the question. And the answer is not one that landlords are going to like. Here’s a look at the so-called In Re Hitz...