Comcast Prevails in Dispute over Interpretation of Commercial Lease

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Maynard Industrial Properties Associates Trust (MIPA), a commercial landlord, sued Comcast of Massachusetts III, Inc. (Comcast). The dispute focused on the amount Comcast would owe under an extension of the amended lease.
 
The amended lease had a base rent of $8.75 per square foot and stated that the lease term would expire on May 31, 2019. The amended lease gave Comcast the option to extend the lease. If exercised, the first option would commence on June 1, 2019, and last five years, with a base rent of 100% of the then-prevailing market rate for similar quality buildings in Maynard, Massachusetts, provided that the rate would not be less than the current rent of $8.75 per square foot and not more than 110% of the rent for the preceding lease year.
 
Comcast exercised the first option to extend and notified MIPA that the rent for the extended term would be $9.63 per square foot. MIPA then filed suit, seeking a declaration that the base rent during the extension option was $18.10 per square foot (or an amount more than $9.63). Comcast moved for judgment on the pleadings.
 
Looking to the plain language of the lease, Judge Green determined that there was no ambiguity in the lease. According to Judge Green, the lease “sets both a floor and a ceiling for the rent calculation.” The plain language provided that the rent under the first extension would not be lower than the current rent of $8.75 per square foot or higher than 110% of the current rent. After multiplying the current rate of $8.75 by 110% and rounding the results, Judge Green found that the rent was $9.63 per square foot. The Court granted Comcast’s motion for judgment on the pleadings, ruling that $9.63 per square foot was the base rent during the five-year extension.

The Business Litigation Session of the Massachusetts Superior Court

Docket Number: 2019-02430-BLS1

Case Name: Maynard Industrial Properties Associates Trust v. Comcast of Massachusetts III, Inc.

Date of Decision: March 5, 2020

Judge’s full name: Karen F. Green, Justice of the Superior Court

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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