Legal Question in Real Estate Law in District of Columbia

Re: commercial property lease renewal

Hello,

your question cannot be answered without looking at your lease as each lease may contain clauses that regulate a renewal. Generally speaking, in the absence of a specific clause in the lease to the contrary, a landlord can increase the rent. A 70% increase sounds a little steep but we would need to look at your situation in its entirety: for example have there been raises in the past, what is the market like, and so forth. Negotiation is the "key" in most leases, especially commercial leases where expenses on both sides can be quite large.

If you need help, please do not hesitate to call me.

Good luck to you,

Tiziana Ventimiglia.

Re: commercial property lease renewal

You sound like you are the lessee (Tenant), not the lessor (landlord). Commercial leases in the District (as elsewhere) are substantially unregulated (unlike residential leases). So you have to look to the terms of the lease. Some renewal options have fixed rents, or fixed rent increases, or peg the increase to a determinate index (for example, the consumer price index). Or they provide a means to determine the rent (a neutral party, perhaps). Others just provide that the parties have to agree. If you don't agree, there is no renewal, and the lanlord is free to lease to someone else. Such clauses are essentially meaningless, although there may be some requirement for the landlord to act in good faith in setting the rent. You need to compare what the landlord is asking with the market. He's certainly entitled to a market rent, and a 70% increase over the last 10 years is certainly not out of the question. If you find he's above market, you can make a counter-offer. It will cost him to re-rent to someone else (leasing agent commissions, build-out allowances, etc.), just as it will cost you to move, so you both have an incentive to reach a fair number.

Re: commercial property lease renewal

Commercial leases are negotiated between the tenant and the landlord to arrive at a contractual agreement between the parties. It is essential for a commercial tenant to develop and work through a negotiation strategy, lease terms and conditions, etc. An experienced real estate and business law attorney should be able to handle this under DC law. Please note that my legal services are available only with a signed engagement agreement in accordance with the Code of Professional Ethics applicable to attorneys licensed to practice law in DC. If I can be of any help to you or people you know, give me a call as I would be pleased to provide legal support. Sincerely, Robert Beatson, II; 12-1-2002, 6:10 p.m. EST; Law Offices of Robert Beatson, II; 9818 Glynshire Way, Potomac, MD 20854; Tel/Fax 301-340-2951; email: [email protected]; website: www.beatsonlaw.com; Licensed to practice law in DC, MD, VA, and NY.