Force Majeure Provisions in Commercial Leases
In commercial leasing, force majeure provisions play in important role in protecting both landlords and tenants from unforeseeable events that could impede the fulfillment of contractual obligations. These clauses have gained heightened attention in recent years,...
Allocating Compliance Costs in a Commercial Lease
Compliance with applicable laws and regulations is a critical aspect of managing and occupying commercial real estate. These laws can cover a broad spectrum of issues, from safety and environmental standards to accessibility requirements like those under the Americans...
Fixed Rate Extension Options: Landlords Beware
In commercial lease agreements, extension options are a common provision that allow tenants to continue occupying a property beyond the initial lease term. One specific type of extension option is the fixed rate extension option, where the rent for the extension...
Extension Options in a Commercial Lease
Extension options, sometimes called renewal options, are a provision in a commercial lease that grants the tenant the right, but not the obligation, to extend the lease term for an additional period. This right is typically exercised before the expiration of the...
Relocation Provisions in Commercial Leases
In commercial leasing, a key aspect that can significantly impact both landlords and tenants is the inclusion of relocation provisions. These provisions grant the landlord the right to relocate a tenant within the same building or complex. While relocation rights can...
Letters of Credit vs. Security Deposits in Commercial Real Estate Leases
In commercial real estate transactions, landlords often require tenants to provide financial security to safeguard against potential defaults on lease obligations. The two most common forms of security are letters of credit and security deposits. While both serve...
Lease Guaranties: Understanding Their Role and Key Considerations in Commercial Real Estate Leases
A lease guaranty involves a third party, known as the guarantor, committing to fulfill the tenant's obligations under the lease if the tenant defaults. Guaranties help provide credit support for tenants that may not otherwise have the financial wherewithal on...
Understanding Casualty and Condemnation Provisions in a Commercial Purchase Agreement
One of the things that a commercial real estate purchase agreement does is allocate the “risk of loss” for the property prior to closing. Typically there is a period of time, frequently 60-90 days, but sometimes as long as a year or more, between when the...
Tenant Termination Options in Commercial Leases
Commercial real estate leases generally do not include a right for the tenant to terminate the lease early. However, in certain circumstances, a commercial tenant may negotiate with its landlord for the inclusion of an early termination option in a lease....
ROFO vs. ROFR: What’s the Difference?
When negotiating a commercial lease, many tenants seek a preferential right to lease additional space in a building. This may be because the tenant wanted additional space when signing the initial lease but such space was not available, or the tenant may simply be...