Recently we began working on a renewal for a new client. The very first thing we did was to review his current lease and rent invoice. When we review a lease, we complete a Lease Abstract form which is a 2-page summary of your 40+ page lease. This review gives us ideas for areas of negotiation during the renewal. Oftentimes we find non-monetary terms that could use some modification.
For this client, the rental rate is right around the market rate, so I am not anticipating being a super hero when it comes to the monthly rent. What gave us pause were some of the non-monetary terms of the lease. I found a fascinating holdover/lease expiration clause with a unique twist that benefits the landlord and could wreak havoc on the tenant. We discovered the guaranty held the corporation officers personally liable for the lease and the assignment/sublease clause was a bit onerous.
I have shared all of this with my client with my recommendations. Now I have begun engaging with the landlord to begin the renewal process, and it will be an interesting negotiation because most of our concerns are non-monetary. That is why you should have an advocate who understands these complex documents. Your landlord uses an expert leasing team, why shouldn’t you?
Contact us today for your free lease audit. You never know what we could uncover for you.