Click here to close now.

SYS-CON MEDIA Authors: Liz McMillan, Esmeralda Swartz, Hovhannes Avoyan, Elizabeth White, Adrian Bridgwater

News Feed Item

Long Island Law Firm Identifies Top Commercial Lease Questions Landlords and Tenants Must Answer

Roe Taroff Taitz and Portman Explains The Impact of Common Commercial Lease Terms for Landlords and Tenants

BOHEMIA, N.Y., Feb. 11, 2014 /PRNewswire/ -- Landlords often ask if a lease is OK to send, while tenants want to know if it is OK to sign. "In both cases, I usually provide the same response," says Steve Taitz, managing partner of the Long Island Law Firm of Roe Taroff Taitz and Portman, LLP. "Will you be OK with everything in the lease if anything goes wrong?" When dealing with any lease, and commercial leases in particular, the most important issue is understanding what is in the lease. Taitz has identified the Top Commercial Lease Questions that can help landlords and tenants in determining whether a lease is right for them to sign.

(Logo: http://photos.prnewswire.com/prnh/20140211/NY55808LOGO)

Top Commercial Lease Questions
Whether you are the landlord or the tenant negotiating a commercial property lease, you should be aware of these common questions that set commercial leases apart from traditional residential lease agreements.

  • Is the lease gross or net?
  • What are the additional costs or additional rent associated with the lease?
  • What will be the proportional share of additional costs?
  • What does the lease call for besides rent?
  • What common commercial lease provisions will be included?

Gross vs. Net
Commercial leases generally come in two flavors: gross leases and net leases.  Gross leases require a commercial tenant to pay one price each month to the landlord.  In a gross lease, generally the landlord will be responsible for all costs and activities associated with the maintenance of their property.

Net leases are a little bit different.  A landlord charges "rent," but also requires that the tenant pay its proportionate share of various costs, often including building maintenance and operating costs This enables the landlord to understand what his income will be from the rent. 

The landlord does not need to guess about escalating costs associated with the building because his tenants will share in the actual costs of maintaining the building.  Tenants will absorb all increases, and presumably share in any decreases, to the costs of operating the building. In theory this provides the landlord with a true fixed income from rent. 

Additional Costs or Additional Rent
Additional costs, generically called "additional rent," typically include real estate taxes, general liability insurance, and common area maintenance, often referred to as "CAM" in a lease.  CAM is the generic catch-all for building maintenance items that can include capital improvements, insurance, administration, waste removal, landscaping, cleaning, snow removal or a variety of other items.  It is important that all common area maintenance items are specifically defined in the lease and that any other charges for additional rent are spelled out.

Proportional Share
With net leases, each tenant will typically a proportional share of the additional rent.  If a tenant occupies 100 percent of the building, that tenant will be responsible for 100 percent of the additional rent.  If there is more than one tenant then each tenant shares in the additional rent or costs based upon the amount of space each tenant occupies.  So, if a tenant only occupies one-quarter of the building the tenant would typically pay 25 percent of the costs of additional rent.

Utilities
Utilities may be separately metered or may be shared proportionately.  If one tenant is sharing space with another tenant who may use more than its proportionate share, this is an issue which should be addressed with the landlord.  For example, if one tenant is a "dry" store, that is only has a sink and toilet, but has 50 percent of the building and the other tenant is a laundromat which has 50 percent of the space, it might not be reasonable to expect the first tenant to pay half of the utilities such as water, gas, or electric.

Common Commercial Lease Provisions

There are a variety of other issues that may come up in commercial leases which you would not typically see in residential leases.  Such provisions, which may appear in the basic lease document or be appended in a rider to the lease, include but are not limited to:

  1. Responsibility for repairs.
  2. Landlord's right to re-locate tenant.
  3. Landlord's right to approve signage.
  4. Tenant's rights (if any) of subleasing or assigning the lease.
  5. Insurance.
  6. Subordination to landlord and mortgagee.
  7. Competition, restrictive covenants, and exclusivity.
  8. Estoppels certificates.
  9. Permits and licensing.
  10. Parking.
  11. Personal guaranty.
  12. Financial statements.
  13. Owner's limitation of liability.

"While a commercial lease agreement appears to focus on the square footage, rent and utilities, the reality is that there are a myriad specific requirements of both the landlord and tenant that must be met in order to reach agreement between both parties," says Taitz. "While there are many commercial lease forms, there is no 'one-size-fits-all' final lease. A strong commercial lease that contains provisions that are fair to both parties often requires an attorney familiar with creating and editing such a document."

About Roe Taroff Taitz and Portman
Roe Taroff Taitz and Portman, LLP provides a wide variety of legal services to Long Island. Our attorneys have served the residents of Suffolk County for more than two decades. Comprised of attorneys, legal assistants and administrative staff, the firm provides support at various levels of legal expertise. Our resources are available to both businesses and individuals looking for experienced legal representation. The firm's primary areas of concentration include civil litigation, creditor's rights law, trust and estates issues, estate planning, admiralty claims, business counseling and real estate matters. For more information, please call 631-475-4400 or visit http://www.RTTPLaw.com

Media Contact
Monique Merhige 
Communication Strategy Group 
[email protected] 
1-866-997-2424

SOURCE Roe Taroff Taitz & Portman, LLP

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
SYS-CON Events announced today the IoT Bootcamp – Jumpstart Your IoT Strategy, being held June 9–10, 2015, in conjunction with 16th Cloud Expo and Internet of @ThingsExpo at the Javits Center in New York City. This is your chance to jumpstart your IoT strategy. Combined with real-world scenarios and use cases, the IoT Bootcamp is not just based on presentations but includes hands-on demos and walkthroughs. We will introduce you to a variety of Do-It-Yourself IoT platforms including Arduino, Ras...
SYS-CON Events announced today the DevOps Foundation Certification Course, being held June ?, 2015, in conjunction with DevOps Summit and 16th Cloud Expo at the Javits Center in New York City, NY. This sixteen (16) hour course provides an introduction to DevOps – the cultural and professional movement that stresses communication, collaboration, integration and automation in order to improve the flow of work between software developers and IT operations professionals. Improved workflows will res...
The best mobile applications are augmented by dedicated servers, the Internet and Cloud services. Mobile developers should focus on one thing: writing the next socially disruptive viral app. Thanks to the cloud, they can focus on the overall solution, not the underlying plumbing. From iOS to Android and Windows, developers can leverage cloud services to create a common cross-platform backend to persist user settings, app data, broadcast notifications, run jobs, etc. This session provide...
“In the past year we've seen a lot of stabilization of WebRTC. You can now use it in production with a far greater degree of certainty. A lot of the real developments in the past year have been in things like the data channel, which will enable a whole new type of application," explained Peter Dunkley, Technical Director at Acision, in this SYS-CON.tv interview at @ThingsExpo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that Soha will exhibit at SYS-CON's DevOps Summit New York, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Soha delivers enterprise-grade application security, on any device, as agile as the cloud. This turnkey, cloud-based service enables customers to solve secure application access and delivery challenges that traditional or virtualized network solutions cannot solve because they are too expensive, inflexible and operational...
SYS-CON Events announced today that Ciqada will exhibit at SYS-CON's @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Ciqada™ makes it easy to connect your products to the Internet. By integrating key components - hardware, servers, dashboards, and mobile apps - into an easy-to-use, configurable system, your products can quickly and securely join the internet of things. With remote monitoring, control, and alert messaging capability, you will mee...
Containers and microservices have become topics of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 16th Cloud Expo at the Javits Center in New York June 9-11 will find fresh new content in a new track called PaaS | Containers & Microservices Containers are not being considered for the first time by the cloud community, but a current era of re-consideration has pushed them to the top of the cloud agenda. With the launch ...
Health care systems across the globe are under enormous strain, as facilities reach capacity and costs continue to rise. M2M and the Internet of Things have the potential to transform the industry through connected health solutions that can make care more efficient while reducing costs. In fact, Vodafone's annual M2M Barometer Report forecasts M2M applications rising to 57 percent in health care and life sciences by 2016. Lively is one of Vodafone's health care partners, whose solutions enable o...
of cloud, colocation, managed services and disaster recovery solutions, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. TierPoint, LLC, is a leading national provider of information technology and data center services, including cloud, colocation, disaster recovery and managed IT services, with corporate headquarters in St. Louis, MO. TierPoint was formed through the strategic combination of some of t...
SYS-CON Media announced today that @WebRTCSummit Blog, the largest WebRTC resource in the world, has been launched. @WebRTCSummit Blog offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. @WebRTCSummit Blog can be bookmarked ▸ Here @WebRTCSummit conference site can be bookmarked ▸ Here
While not quite mainstream yet, WebRTC is starting to gain ground with Carriers, Enterprises and Independent Software Vendors (ISV’s) alike. WebRTC makes it easy for developers to add audio and video communications into their applications by using Web browsers as their platform. But like any market, every customer engagement has unique requirements, as well as constraints. And of course, one size does not fit all. In her session at WebRTC Summit, Dr. Natasha Tamaskar, Vice President, Head of C...
Public Cloud IaaS started it's life in the developer and startup communities and has grown rapidly to a $20B+ industry, but it still pales in comparison to how much is spent worldwide on IT: $3.6 trillion. In fact, there are 8.6 million data centers worldwide, the reality is many small and medium sized business have server closets and colocation footprints filled with servers and storage gear. While on-premise environment virtualization may have peaked at 75%, the Public Cloud has lagged in ado...
Dave will share his insights on how Internet of Things for Enterprises are transforming and making more productive and efficient operations and maintenance (O&M) procedures in the cleantech industry and beyond. Speaker Bio: Dave Landa is chief operating officer of Cybozu Corp (kintone US). Based in the San Francisco Bay Area, Dave has been on the forefront of the Cloud revolution driving strategic business development on the executive teams of multiple leading Software as a Services (SaaS) ap...
ProfitBricks, the provider of painless cloud infrastructure IaaS, today released its SDK for Ruby, written against the company's new RESTful API. The new SDK joins ProfitBricks' previously announced support for the popular multi-cloud open-source Fog project. This new Ruby SDK, which exposes advanced functionality to take advantage of ProfitBricks' simplicity and productivity, aligns with ProfitBricks' mission to provide a painless way to automate infrastructure in the cloud. Ruby is a genera...
SYS-CON Events announced today that GENBAND, a leading developer of real time communications software solutions, has been named “Silver Sponsor” of SYS-CON's WebRTC Summit, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. The GENBAND team will be on hand to demonstrate their newest product, Kandy. Kandy is a communications Platform-as-a-Service (PaaS) that enables companies to seamlessly integrate more human communications into their Web and mobile applicatio...