Leasing Primer: A Summary of Issues and How-To Manual For Landlords and Tenants

InfoPAK Download pdf September 2009

Sponsored by: WilmerHale

This InfoPAK organizes the collective experiences of lease transactions over many years, for the benefit of in-house counsel dealing with the all-important aspect of leasing real estate. This information is presented in checklist format, addressing the major issues encountered during sophisticated commercial leasing transactions, and presents potential solutions to those issues. It also includes a number of sample leasing provisions. This InfoPAK is intended to be a useful guide for counsel dealing with office, industrial, or retail properties, whether counsel represent landlords or tenants.

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Author: WilmerHale
Keywords:  Real Estate; Landlord Tenant; Leasing

Table of Contents

Introduction

Parties to the Lease

• Issues Related to the Party Acting as Landlord
• Issues Related to the Party Acting as Tenant
• Issues Related to Any Change in the Parties to a Lease

The Premises & the Building

• Defining the Space
• Options for Expansion or Contraction of Space
• Relocation Rights for the Landlord
• Ancillary Space Needs of the Tenant
• Rights to Other Building Amenities

Rent & Other Charges

• A Basic Rental Structure in Leases
• Types of Rental Charges

Lease Term & Extensions

• The Initial Term of the Lease
• Options for Renewal or Early Termination of the Lease Term
• Tenant Holdovers Beyond the Lease Term

Tenant Space Improvements

• Initial Preparation for the Tenant’s Occupancy
• Completion of the Tenant Space Improvements
• Delays in Completion of the Initial Improvements
• Allowances & Payment for Tenant Space Improvements
• Subsequent Alterations to the Space by the Tenant
• Restoration & Other End-Of-Term Obligations

Restrictions on Use of Space

• Lease Provisions Controlling the Use of Space
• Regulatory Limitations on Use of Space

Building Services

• Building Services to be Provided
• Building Systems & Capabilities
• Interruptions in Building Services

Maintenance & Repair Obligations

• Obligations of Landlord and Tenant with Respect to the Space and the Building
• Landlord’s Access to the Tenant’s Space for Repairs and Alterations

Insurance & Liability

• Tenant's Insurance Requirements
• Landlord's Insurance Requirements
• Clauses Waiving Rights of Subrogation
• Provisions For Indemnification Against Damage or Injury

Agreements For Lenders & Purchase

• Estoppel Certificates Confirming Certain Facts
• Agreements for Subordination, Non-Disturbance, and Attornment

Casualty & Condemnation Provisions

• Casualty & Property Damage
• Condemnation & Eminent Domain

Defaults & Remedies

• Defaults by the Tenant
• Landlord’s Remedies on Tenant Default
• Defaults by the Landlord

Miscellaneous

• The Objective Standard of Reasonableness
• Alternative Dispute Resolution

About the Author

Sample Provisions

• A Schedule 2A(1): Non-Recourse Provision
• Schedule 2B(2): Letter of Credit Provision
• Schedule 2C: Assignment & Subletting Provisions
• Schedule 3A(1): Re-Measurement Provision
• Schedule 3B: Right Of First Offer Provision
• Schedule 3C: Relocation Provision
• Schedule 4B(2)(e): Gross-Up Provision
• Schedule 4B(3): Percentage Rent Provisions
• Schedule 5A(2): Commencement Date Provisions
• Schedule 6A(4): Work Letter Provisions
• Schedule 6C(3): Force Majeure Provision
• Schedule 6D(2): Allowance Payment Provision
• Schedule 8C: Service Interruption Provisions
• Schedule 10: Insurance And Indemnification Provisions
• Schedule 13B(1)-(5): Landlord Remedy Provisions
• Schedule 13B(6): Damages Provision
• Schedule 14B: ADR Provisions

Endnotes