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This. It’s such a simple, little word, one that we all use countless times per day. But used the wrong way in a commercial lease, “this” can bite a landlord in the backside. If you don’t believe it, ask the Arizona landlord that lost a juicy rent increase because of “this.”

The pandemic has illustrated the need for landlords and tenants to be flexible and work together to find solutions to leases that have become disadvantageous. One approach is to enter into a buy-out agreement allowing the tenant to end the lease early in exchange for an agreed-to sum of money.

Getting tenants to leave their space when the lease ends can be a difficult and costly proposition. For one thing, you may have to initiate an eviction suit to get the tenant out. And if you’ve already re-rented the space, holdovers expose you to the risk of being sued by the new tenant for failing to deliver the space on time. All of this makes the holdover rent rate a crucial issue in typical lease negotiations. If a tenant is in a strong bargaining position, yo...

Before notifying a tenant that it’s in default, be sure to check the lease to see if it includes any special requirements. If so, follow those requirements to the letter, or you could end up losing your eviction and other remedy rights.

Don’t ease up on your efforts to re-rent space that a tenant has vacated early—even if the tenant is doing its own search for somebody to take over its rent obligations. While spending your own time and money might seem like a needless reduplication of effort, sitting back and counting on the tenant to line up a replacement can prove even more costly.

Commercial property owners should ensure that their leases describe all tenant payments and charges as either “rent” or “additional rent.” While it might seem like a legal technicality, using these terms ensures you access to fast-track eviction if the tenant later defaults on its obligation to pay operating expenses, taxes, trash removal, parking fees, and other leasing costs.

SITUATION: With long-term plans to redevelop its mall, a Connecticut owner made it a point to include relocation clauses in leases with a restaurant tenant in an area slated for new construction. The clause also gave the owner the right to terminate the tenant for refusing relocation to substitute premises of comparable square footage.  

The last thing any landlord wants is to allow a tenant to purchase the property while it’s in default. Unfortunately, that’s exactly what you might have to do if the purchase option clause in your lease contains a common loophole.  

Guaranty agreements may cap how much the guarantor has to pay if the tenant defaults. For example, the agreement may say that $100,000 is the most the landlord can collect from the guarantor. If you include dollar caps in your own lease guaranties, just be sure that they exclude attorney’s fees, cautions a New York City leasing attorney.  

It's important to make your notice to a tenant valid if your attorney sends it. If a tenant violates your lease, you're probably required to notify the tenant in writing that if it doesn't cure—that is, correct—the violation by a set deadline, you can take action against it. But it's common for owners to ask their attorneys to send this violation notice on their behalf, because they think that will show the tenant that they're serious and...