Legal Question in Real Estate Law in California
existing lease with new owner
I am a small business owner in CA. My building is in the process of being purchased from a family man to a huge oil company. My family has been in business with this man at this location for over 30 years. Last year we renewed our lease for five years with a five year option. He had a very professional commercial lease drawn up we agreed to the terms and signed last year. It was fair, with annual increases of 2% to the base rent. These increases were written out in a schedule in the lease. The new owners are pressuring us to sign a new lease saying our current lease is a mess and that the language is vague and doesn't work right. They said the new lease is exactly the same just written differently. Their lease is not the same and includes annual raises plus CPI plus other additional expenses. It also eliminates an existing second story from our current lease which they say is invalid because it is residential and this is commercial property. We had a very heated meeting and of course I have thus far refused to sign this lease. They have now requested us to immediately sign an estoppel and attach it to the old lease. Should I do this? Should I be fighting this big oil company on these lease terms or is it best to just go along with
2 Answers from Attorneys
Re: existing lease with new owner
An estoppel is a document a tenant signs to verify that the current landlord is not in breach of any of its obligations under the lease. Most commercial leases, if they are any good, will require tenants to fill out one upon demand.
As my partner advised, you really need to seek legal advice. You don't want to start a fight with your new landlord, but you do want to protect and assert your rights. Be careful in this area. Tenants many times believe they are protecting their rights when in actuality they are violating their obligations under the lease.
Re: existing lease with new owner
Your instincts sound pretty good and it is clear that you have a decent understanding of the issues. However, it would probably be a wise investment for your business to consult with an attorney who understands commercial leases.
Our firm can assist your family with this issue. We draft commercial leases and have litigated commercial lease disputes. Feel free to contact me directly to discuss.
Regards,
Ben
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