On behalf of Kadish & Associates Law Group posted in Commercial Real Estate Disputes on Tuesday, July 18, 2017.
In metropolitan areas like Phoenix, Arizona, there are many commercial leases available. Businesses need to consider a wide range of factors when choosing one, to make sure that it suits the needs of their staff and customers. However, sometimes businesses need to get out of commercial leases that they have signed. In those cases, they may find themselves in need of Phoenix, Arizona, commercial real estate litigation attorneys.
There are many reasons why a business would want to get out of their commercial lease. One is that there might be problems with the suite, building or property that the commercial lease is for. These problems may not have been apparent at the time that the lease was signed.
Another reason for a business needing to get out of their commercial lease is that their business is not succeeding in that area. That could be because something, such as competitors or other attractions, is drawing prospective customers to a different location. It can also be because there isn’t sufficient visibility, foot traffic or parking in the area to allow for a significant flow of prospective customers.
Many businesses will prepare for this contingency in advance by inserting a clause in the lease when they first signed it that allows for an “early exit”. Clauses like this are very wise to include, since they protect you from prolonged battles if you do need to get out of the lease early.
There are multiple ways to approach the inclusion of such clauses. One is to structure it in the lease as an allowance for canceling the lease if your business doesn’t meet specific income goals by the six-month or one-year mark after the start of the lease. Property managers can be amenable to such clauses because they want to lease to successful businesses, as doing so drives up the value of other nearby businesses, some of which the property managers may also lease. A good attorney can help you put together a carefully constructed clause that will protect your business.
Source: Entrepreneur, “Getting Out of a Commercial Lease,” Jeffrey Steinberger, accessed July 18, 2017