OFFICE TENANT NEGOTIATION CHECKLIST=
A. =
Ask
that word processing file be emailed to you. It is easier for both sides if
proposed language for suggested changes are typed in and redlined, instead =
of
being on a separate sheet. Do not use Word change tracking to redline since
file will show intermediate changes even if you accept changes and turn it =
off.
B. =
If
lease uses lessor and lessee, to avoid confusion make global changes to
landlord and tenant before reading, and change back when changes are submit=
ted
to landlord.
C. =
If
lease uses a lot of defined terms, whose definitions are nested (based on
combinations of other defined terms), study the definitions like a foreign
language, and do not read the lease until you are comfortable with the
definitions and their interaction since one innocuous defined term can
represent a paragraph of pure poison.
D. =
Be
careful of dates, particularly “as of dates” since some times a
date is picked so that a tenant pays for an increased tax assessment, wage
increase, or complying with a new law.
E. =
Make
sure that the lease covers all that you think you are getting ranging from =
use
of areas such as terraces to HVAC, and building access hours.
F. =
Where
landlord is to provide a piece of equipment, make sure that he is also goin=
g to
install it at his sole cost and expense. It can cost over $100,000 to insta=
ll
an air-conditioning unit.
1. =
Alteration
Rights
(a) Decorative _ without consent
(b) =
; Non-structural
of less than $______, without consent
(c) =
; Consent
NTBUWD in all other cases
(d) =
; No
restoration obligation
2. =
Assignment/Subletting
Rights
(a) =
; [Partial]
sublets without recapture rights
.(b) &nbs=
p; Right
to assign or sublet to related entities without consent and to permit same =
to
occupy demised premises without consent
(c) =
; Right
to assign to successor corps or entitles without consent
(d) =
; Transfers
of interests [without consent] or [among current shareholders or partners a=
nd
their families, and trusts for their benefit without consent]
(e) =
; No
profit sharing and no recapture rights re: assignments or sublets not requi=
ring
consent
(f) =
; Request
for consent should include proposal only not actual sublease/assignment
3. =
Damage
or Destruction
(a) =
; Landlord
obligation to rebuild
(b) =
; Tenant
right to cancel
(c) =
; Waiver
of subrogation
4. =
Escalations
(a) =
; Real
Estate Taxes
(i) =
; Check
target assessment
(ii) &nbs=
p; &=
nbsp; No
increase due to sale
(iii) &nb=
sp; =
Assessments
deemed payable over maximum
period permitted by law.
=
_(iv) &nbs=
p; &=
nbsp; RE
taxes not to include income taxes,
franchise taxes, etc.
(v) =
; &n=
bsp; Substitute
Tax - Landlord taxed as if it owned only the
building and no other properties.
=
(b) Operating
Expenses
(i) =
; &n=
bsp; No
operating expenses attributable to asbestos or laws with which Landlord is =
not
in compliance on Commencement Date
(ii) &nbs=
p; &=
nbsp; Gross-up
of base year and escalation years as if building fully
=
occupied
(iii) &nb=
sp; =
Right
to audit and dispute by arbitration
(c) =
; Miscellaneous
(i) =
; &n=
bsp; Representations
as to numerator/denominator used to determine proportionate share
(ii) &nbs=
p; &=
nbsp; 1
year limitation on Landlord’s right to bill for escalations
5. =
Services
(a) =
; Confirm
types of services, who pays and when available
(b) =
; Provide
for overtime services and freight elevator service at Landlord’s actu=
al
out_of=
_pocket cost
(c) =
; Right
to abate rent and/or cancel if Landlord fails to provide essential services=
6. =
Subordination
(a) =
; Is
landlord fee owner?
(b) =
; Status
of existing mortgages
(c) =
; Non-disturbance
agreement
7. =
Requirements
of Law
(a) =
; Only
if arises out of Tenant’s particular manner of use of premises.
(b) =
; Right
of Tenant to contest specific requirement of law
(b) =
; Landlord
obligated re: asbestos, fire system etc.
8. =
Default
(a) =
; No
conditional limitation for monetary default.
9. =
Electricity
(a) =
; Representations
as to electrical capacity of demised premises
(b) =
; Right
to contest electric by survey, if Landlord has been overcharging Landlord p=
ays
cost of survey.
(c) &n=
bsp; If
submeter, meter should measure electric consumption of demised premises onl=
y,
and as if single meter. Rate charged should not exceed what ConEd would cha=
rge
tenant for direct service.
(d) =
; Landlord
may not discontinue electricity to demised premises unless majority of tena=
nts
by footage are being disconnected, Tenant should have right to use existing
risers.
10. =
; Miscellaneous
(a) =
; Estoppel
Certificates _ Mutual
(b) =
; Number
of Directory listings _
main lobby and floor, if applicable
(c) =
; Free
freight elevator for build-out, move in, and - move out.
(d) =
; Consents
or approvals _ not to be unreas=
onable
withheld or delayed
(e) =
; All
entries upon premises and work by Landlord shall be performed in a manner s=
o as
to minimize interference with Tenant’s use of premises
(f) =
; Right
to cure Landlord defaults
(g) =
; HVAC
specifications
(h) =
; Cleaning
specifications
(i) =
; Certificate
of Occupancy
(j) =
; Tenant
not obligated to remove alterations at end of term.
(k) =
; Delivery
of possession _ outside date
3