Drafting Tips

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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...

Even before the case starts, landlords are at a distinct disadvantage when they go to court over a lease interpretation: Because the landlord drafts the lease, courts will read any ambiguity in the tenant’s favor. Regrettably, landlords all too often aggravate this disadvantage by making assumptions that confuse what they think a lease provision means with what it actually says. And it’s not just landlords. Tenants are often guilty of the same mistake.

Security deposits are essential for commercial real estate owners to protect their interests when leasing space to tenants. That’s because a security deposit can be used in a number of ways to minimize the effect when a tenant doesn’t meet its lease obligations. But a security deposit amount that seems adequate at the start of the lease may not cover damages from a tenant’s breach later.

If you own a shopping center or mall, you know that the success of your tenants is connected to the amount of foot traffic that you can bring in. Movie theaters are a great example of one type of tenant that attracts crowds. But not all movie theaters show films that are of interest to a wide variety of moviegoers. For example, a movie theater that shows only independent films won’t draw as diverse a crowd as one that shows blockbusters and mainstream pictures.

If you own office building or retail space you’re probably very reluctant to give a termination right to your tenants in their leases. You run the risk of losing a large amount of money; allowing a tenant to get out of its lease early can render costly improvements and other expensive items associated with renting to it useless for reletting the space.

Adding a food court—a special area dedicated to small restaurant tenants selling a diverse selection of carry-out or ready-to-eat food customers can consume in a common seating area—can be a great way for shopping center owners to generate income. And it can help extend the length of shopping excursions, which results in more purchases and higher percentage rent for owners. It’s also a desirable amenity for tenants of an office complex. While a food co...

While sometimes an owner’s failure to keep a center safe causes issues, tenants are also capable of actions that cause problems, too. And that’s where arguments and litigation arise. An owner is typically responsible for maintaining the common areas of its building or center, so if someone is injured in these areas, the owner is the party that will most likely have to pay for damages from an accident.