Commercial Tenant Agreements: Maintenance and Improvements
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A commercial building lease should include tenant agreements that specifically address maintenance of and improvements to the leased building. The commercial lease must be negotiated term by term. The time to negotiate is before the lease is signed and not after it is in effect and a dispute arises between the tenant and landlord.
There are two maintenance issues to address when negotiating a commercial lease. You must first come to agreement on who will take care of routine maintenance like roof repairs, and parking lot and general HVAC maintenance.
The lease should also specifically address who is responsible for building repairs when building codes are revised, or it is discovered after the fact that the building or infrastructure is not code compliant. It can become a serious matter of contention if the lease does not clearly set out who is to pay for this type of maintenance.
An attorney negotiating lease terms for the landlord or tenant will require that the building be inspected by a licensed contractor. If problems are found, the landlord may be required to pay for the repairs that bring the building into compliance before the lease begins. The tenant can demand that the landlord provide written warranties.
Improvements to the Building
Before a tenant agrees to lease a building, it is important to determine if any improvements to the building are needed before or during occupancy. The tenant will usually expect the lessor to pay for necessary building upgrades to the roof, HVAC, electrical, parking lot or access for disabled persons. The lease should define exactly what work is to be completed, when work is to begin, and the date of completion.
Other than for specifically defined improvements outlined in the lease, the tenant will be held responsible. That’s why it is also important to include a clause in the lease that clearly defines the responsibilities of the landlord to make improvements to the building when the laws are changed. For example, the American with Disabilities Act is frequently interpreted through court cases that lead to new specific building requirements that must be met in order to comply. The EPA and energy code regulations are also upgraded regularly.
Get the Advice of an Expert Attorney
It is important to consult with an attorney who has expertise in negotiating commercial leases. A poorly written lease can lead to expensive litigation in the event of a dispute between the landlord and the tenant.