How to Break a Commercial Lease

 

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Eleven Points to Examine if you are Thinking about Breaking a Commercial Lease

  1. Do you have a lawful right to terminate the commercial lease without cause?
  2. Do you have a lawful right to terminate for cause, and what are the causes?
  3. Is there a liquidated damages provision in your lease and can you afford to fight over that amount?
  4. Every commercial lease imposes some express obligation on the property owner; what does your lease say? If the property owner has violated those obligations, you may have a basis to seek termination.
  5. Many states impose certain implied obligations on property owners. Is the premises unacceptable in some significant manner and could that condition violate any of ownership’s implied obligations?
  6. What were ownership’s disclosures about the premises? Could you have a fraud claim?
  7. Does ownership control adjoining premises? Are those adjoining premises engaged in any unlawful behavior?
  8. Are you aware if ownership has assigned the premises; perhaps the new owner wants new tenants.
  9. Are you allowed to assign the premises?
  10. What is ownership’s financial condition? Would they be amenable to a negotiated settlement?
  11. Will the damages, upon vacancy, be significant? Can you locate a replacement tenant and eliminate any exposure?

These is only a sample of the major issues that a competent, experienced commercial real estate trial attorney will need to know if she is to help you. We strongly recommend that you seek out and retain competent counsel in this complex area of commercial real estate law.

 

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