Tenants who are negotiating a commercial lease are often eager to keep their costs as low as possible. They may negotiate specific terms with a landlord in the hopes of keeping monthly payments low and limiting their long-term liability should their company fail or need to make significant adjustments. One of the many concessions that potential commercial tenants may request during lease negotiations involves maintenance costs.
Typically, commercial landlords pass property maintenance expenses on to tenants directly. Sometimes, these costs vary from month to month, while other times tenants pay a flat amount for maintenance. Some tenants will eagerly sign a lease that does not include any common area maintenance (CAM) fees or triple net (NNN) costs. They may then end up embroiled in a dispute with their landlord because the landlord requires that they perform repairs and maintenance when something goes wrong with the property. Maintenance clauses are a common reason for contract disputes during a commercial tenancy.
Tenants may not understand what they signed
All too often, new business owners may not understand the likely terms included in most commercial leases. They will therefore assume that maintenance costs are simply part of their rent. That is very rarely the case with a commercial lease. In fact, even boilerplate commercial leases sometimes include clauses clearly outlining a tenant’s responsibility to conduct maintenance and repairs at the property.
However, tenants may have glossed over those details and may not have any plan in place to address costs when they arise. They may then find themselves arguing with their landlord, possibly even threatening to withhold rent until the landlord makes certain repairs. The dispute about the least might eventually go to court, where a judge will have to review the contract and then rule on the matter.
Landlords and tenants could reduce the likelihood of conflict by clearly reviewing contracts and discussing certain terms before signing anything. Commercial landlords may even choose to highlight maintenance responsibilities so that tenants cannot claim the landlord mislead them or misrepresented the terms of the contract during lease negotiations.