SDNY Chooses “Time Approach” to Calculating Lease Termination Damages Collectible Against a Bankrupt Estate
Most NYC restaurant leases come with a catch: the landlord wants you, not just your LLC, on the hook. I’ve seen restaurant owners sign personal guarantees without fully understanding what they’re agreeing to—and then watch...more
Landlords of commercial premises generally have one key overriding concern: to maintain their income stream by ensuring that their tenants pay and continue to pay all rents due under their leases. Landlords should act quickly...more
Last week, the U.S. Department of Housing and Urban Development (HUD) shifted the interim rule to revoke the 30 days’ notice of nonpayment to a proposed rule. The proposed rule will go through notice-and-comment rulemaking...more
Rescission is an equitable remedy that restores parties to a contract to their former status by undoing the original transaction. Until recently, proving the landlord’s material breach to rescind a commercial lease was...more
In the balance of power between landlords and tenants, the risk of default is usually higher for the tenant. While many landlords have accrued wealth and invested in low-risk assets, many tenants are embarking on a new...more
Bankruptcy law provides special treatment for landlord claims arising from termination of a lease, using a calculation set forth in Section 502(b)(6) of the Bankruptcy Code. The starting point for the calculation is to...more
Key Takeaways - Termination fee calculations must reflect the full lease context, not isolated clauses. Courts will look at all lease language and subsequent amendments to interpret termination payment formulas, including...more
At last, a decision that examines the consequences of a tenant of assuming a landlord’s obligations regarding repairs and maintenance, as well as the applicability of holdover rent....more
KEY TAKEAWAYS - GSA Leasing: The U.S. General Services Administration (GSA) manages one of the largest real estate portfolios in the country, leasing millions of square feet on behalf of federal agencies....more
Q: I know from prior articles that a receiver for a tenant entity has the right to reject a lease, if to do so is beneficial for the estate. Is the reverse true? ...more
When faced with a financially distressed tenant, an early lease termination agreement can be an effective means for a landlord to resolve the uncertainty created by its tenant’s financial distress and to mitigate potential...more
Introduction - Despite the parties’ best intentions at the beginning of a commercial lease, landlords will inevitably encounter tenants in financial distress. Ultimately, some tenants will seek protection in bankruptcy,...more
In the glow of negotiating a commercial lease, no landlord or tenant wants to think about how it might end early. But recent developments again remind us that a nuanced termination clause will significantly affect if, when...more
As a landlord in New Jersey, you’re likely familiar with standard lease agreements, notice periods, and tenant obligations. But what happens when a tenant wants to break a lease early not due to non-payment or a job...more
The so called “Anadarko Washout” involves a washout of oil and gas leases on undivided working interests owned by non-operating mineral cotenants. This particular species of lease washouts is based on two recent cases from...more
In this lease termination case (Pruett v. River Land Holdings, LLC, No. 03-22-00478-CV, 2024 WL 1745652, at *1 [Tex. App.—Austin Apr. 24, 2024, no pet.]), the Austin Court of Appeals was tasked with examining a cessation of...more
If the tenant and/or its tenant estoppel is important, consider asking them to alert you immediately if they have concerns about meeting response obligations. Your pending refinance or sale may go smoother if you are in...more
In In re Pearl Resources LLC, a Houston bankruptcy court rejected the Texas General Land Office’s attempt to partially terminate state oil and gas leases in Pecos County, despite finding the operator had breached offset well...more
California’s Commercial Tenant Protection Act (SB 1103) now provides commercial tenants who operate small businesses with new legal protections of which property owners, managers and brokers must be aware. Failure to comply...more
Although the COVID-19 pandemic has ebbed from the daily lives of workers, its impact on hybrid work continues. While no consensus has emerged, the hybrid work model, which requires splitting the work week between going into...more
The Trump administration may be utilizing early exit provisions in the GSA lease cancellations and terminations reported to date, but prudent contractors should prepare for other potential tactics to end other leases the...more
Commercial leases are a critical source of income and financial stability for property owners, but the current evolving economic environment presents many risks. One of the primary concerns is when a tenant falls behind on...more
In dealing with a series of intertwined contracts, the English High Court found that the correct interpretation of a contract meant that an airline had had its obligations to make overdue payments terminated but then...more
Senate Bill 1103 (“SB 1103”), effective January 1, 2025, imposes new requirements on landlords leasing commercial space to certain “qualifying commercial tenants” (“QCT” or “QCTs”). Below is a summary of what you need to...more