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One of the most important aspects of any commercial lease is how it apportions responsibility for maintenance and repair of the leased premises, including the roof. Although there’s an infinite number of possible arrangements, tenants are generally expected to contribute to the costs of roof maintenance and minor repairs, while landlords retain financial responsibility for major repairs, replacement, and capital improvements. Of course, landlords and tenants can agree to shift these fundamental responsibilities as they see fit. But to do so requires clear language.

Just about every lease includes a provision specifying the methods landlords and tenants must use to provide notice to each other. Deviations from notice requirements are a common source of litigation, especially when notice is required to exercise a purchase, renewal, or other lease option. We know that oral notice generally won’t suffice when a lease specifically says that notice must be in writing. Beyond that, there are no bright line rules governing how far a party can go in straying from the lease notice rules.

Even in this digital age where information abounds, calculating Consumer Price Index (CPI) rent escalations remains a challenge, and Insider commonly receives requests from users struggling with the issue. There’s a lot at stake. If your CPI calculations aren’t accurate, you may not get the full rent escalations to which you’re entitled. Here’s a formula to simplify CPI calculations along with a step-by-step tutorial on how to use it, as well as a backup formula for ensuring its accuracy.

Not stating the specifics is likely to lead to two results, both of them negative.

If a tenant exercises a renewal option without following all the procedures or requirements set out in the renewal clause, object right away. Failure to speak now may mean that you’ll forever have to hold your peace. That’s because a court might determine that in keeping silent you evidenced your intent to give up the right to enforce the renewal clause’s original terms.

Don’t rely on “implied” covenants that aren’t expressly stated in the lease if you want retail tenants to continuously operate from their space. There’s a possibility that a court will find that such a covenant exists in limited circumstances, such as when the lease requires a long-term tenant to pay a minimal base rent but substantial percentage rent while limiting the tenant’s use and ability to assign and sublet and barring competition. However, most courts don’t recognize an implied covenant to continuously operate.

Redevelopment work is messy, noisy, and disruptive. And the results it produces may not be appealing to all tenants, especially to the extent it makes the shopping center substantially different and less favorable than the one the tenant thought it was committing to. For example, a tenant located near the shopping center entrance may object that a plan to relocate the main entrance violates the lease and prevents it from using the property as it intended when it signed the lease.

Federal and state laws make property owners liable for environmental damage done by a tenant. That makes it imperative to verify that tenants comply with those laws. But a tenant may refuse to grant you access to inspect or perform environmental testing for that purpose. And without clear lease language ensuring such access, you could be literally and figuratively locked out in your quest for verification of environmental compliance, leaving you exposed to millions of dollars in potential liability.   

Q: Two tenants at the shopping center I own are currently in a dispute about who has the right to sell a certain product. A toy store tenant signed a lease with an exclusive use clause that gives it the right to be the only tenant in the center that sells toys. A variety store signed a lease that allows it to sell various items for entertainment. It was made aware at the time of the lease signing that the toy store had an exclusive right to sell toys, and it signed the lease nonetheless.

A signed letter of intent (LOI) is often the preliminary step to a commercial lease. The LOI typically requires the sides to keep the deal confidential while outlining the crucial terms of the lease they both ultimately intend to sign. However, while it may feel like a commitment, the LOI is less than ironclad. Parties may still change their mind either on the lease terms or whether they want to sign a lease at all.