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If a tenant wants you to specify the number of its unit, store, or suite in the lease, then say in the lease that the tenant’s unit, store, or suite is “presently known as [insert Unit/Store/Suitenumber, e.g., 4B]. The phrase “presently known as” will give you the flexibility to change the number of the tenant’s unit, store, or suite during the lease term without having to get the tenant’s consent.
Avoid using Latin phrases—such as, ipso facto and inter alia—in your leases. Instead, use English words that mean the same thing. For instance, instead of saying “ipso facto,” say “of itself” or “by the mere fact.” And instead of saying “inter alia,” say “among other things.” This should help make your leases easier to read and understand.
When listing your remedies in a lease clause—for example, the option to terminate the tenant’s lease if the tenant stops operating its business—always start with the phrase: “In addition to any other rights and remedies available to Landlord under this Lease or at law or in equity….” You should use this phrase because it gives you the right to resort to many types of remedies—not just the ones you’re listing in the partic...
Be careful how you describe the termination right you give a tenant. If you grant the tenant a right to terminate its lease in the event its business is sold, for example, make sure the tenant is required to exercise that right within a specific time period of the sale date. Consider what happened to an owner in a recent case that involved a similar termination right: A New Jersey appeals court determined that the tenant’s termination right was “ongoing&rdqu...
It’s common in most leases to end a list of items with the phrase “including, without limitation,” or “including, but not limited to.” Those phrases are meant to indicate that the list isn’t exhaustive. But if you forget to use them consistently throughout the lease, it can lead to confusion and misunderstanding. Avoid that situation by adding the following language to the definitions section of your lease:
If, like many shopping center owners, you provide off-site traffic improvements for your tenants, you should make sure that you’re compensated for that. After all, these improvements—for example, special signage and lighting in areas leading to the property or a way to control the flow of vehicles into and out of the center—benefit both owners and tenants by helping increase customer traffic, boost sales, and reduce the risk of accidents.
While many commercial leases are for several-year terms, it might behoove you to agree to a month-to-month tenancy with a tenant. Month-to-month tenants can be part of a strategic plan for your property, especially if you have spaces that you’d like to collect rent for in the short term while looking for longer term tenants. If you rent a space on a month-to-month basis to a tenant without a lease, don’t take termination of the tenancy less seriously than yo...
Some office building or mall owners put out “wet floor” signs during rainy or snowy weather to warn customers about slippery conditions that could quickly develop on the floors of the property. In just a few minutes, water can collect, creating a hazard. It’s important to be cognizant of potential areas for liability, but make sure to consult your attorney about what precautions you should take as far as these types of warnings are concerned.
Sometimes a clerical mistake, such as an incorrect date or a misspelled name, is made on a lease document. But if the mistake isn’t caught and corrected, it can lead to a dispute later between you and your tenant—especially if the mistake works in the tenant’s favor and it’s trying to cash in on the error. That’s why it’s important to carefully review the final document for your lease dea...
You may have a “wish list” for items you would like to include in your lease with a prospective tenant, but be careful not to overdo it. Big box tenants or those with a lot of bargaining power are more likely to balk at requests for things that are too owner friendly, but continue negotiations knowing they will get a deal they can live with. But asking for items that are blatantly unfair from smaller tenants, li...
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