Understanding the Commercial Lease Letter of Intent: Key Business Terms to Address Before the Lease Is Drafted
In most commercial leasing transactions, the parties begin negotiations with a Letter of Intent (“LOI”) or term sheet before drafting a formal lease agreement. Although the LOI is usually technically non-binding, it frequently establishes the core economic and...
Operational Issues Industrial Tenants Should Diligence Before Signing a Warehouse Lease
Industrial tenants evaluating warehouse or distribution space often focus heavily on rental rate and square footage when selecting a facility. However, many of the operational characteristics that determine whether a facility will actually function for the tenant’s...
Rent Credits in a Commercial Lease: An FAQ Guide
Rent credits in a commercial lease are frequently misunderstood. Many people think of “free rent” at the beginning of a lease term and stop there. In reality, rent credits are broader than that. They can be negotiated concessions at lease inception, or they can...
Commercial Landlord’s Guide to Letters of Credit
In virtually every commercial lease negotiation, landlords look for credit support to backstop a tenant’s obligations. Whether it is unpaid rent, repair obligations, or damages caused by tenant default, landlords want to ensure there is a readily accessible source of...
Drafting Tip: Addressing Direct Claims in Indemnity Provisions in Commercial Real Estate Contracts
In commercial real estate contracts, indemnity provisions are a foundational risk allocation tool. They are commonly used to shift responsibility for certain claims and losses from one party (the indemnified party) to another (the indemnifying party). At a high level,...
What is a Choice of Law Provision in a Commercial Lease and Why is it Important?
When reviewing a commercial lease, the choice of law provision—also known as a governing law clause—is a common element that deserves attention. This clause identifies which jurisdiction’s laws will apply to the interpretation and enforcement of the lease. For...
What is a Memorandum of Lease and Why is it Important in Massachusetts?
In Massachusetts commercial real estate, understanding when and how to record lease-related documents can help protect long-term interests. One document that often comes into play for leases longer than seven years is the memorandum of lease—also known as a notice of...
What Happens to Commercial Real Estate Leases When a Property Is Sold?
In Massachusetts, commercial real estate transactions often raise an important question for both landlords and tenants: What happens to an existing commercial lease when a property is sold? The short answer is that the lease typically remains in effect, and the new...
Why Are Landlord and Tenant Indemnity Obligations Different in a Commercial Lease?
Indemnity provisions are an important component of commercial lease agreements, defining the extent to which each party is responsible for damages, claims, and liabilities arising from incidents related to the leased property. In essence, an indemnity provision is a...
What is a Security Deposit Burn Down in a Commercial Lease?
In commercial real estate leasing, security deposits serve as a critical risk mitigation tool for landlords. Unlike residential leases, where security deposits are often limited by law, commercial landlords have significant discretion in setting the amount and...