GET IT IN WRITING
Simple rule: “If it’s not in writing than whatever can go wrong will go wrong.” How many times have I heard tenants or clients tell me what a great relationship they have with their landlord? They tell me not to worry about negotiating or modifying the lease or any other documents such as an Estoppel Certificate. The famous last words are, “After all, the landlord and I get along really well.”
Our answer is pretty simple. What happens if the landlord sells the building or the property manager changes? If it’s not in writing and clearly spelled out in the documents then the new person/owner will simple interpret the document to their favor.
Case in point.
We were in the process of renegotiating a lease renewal when the landlord refused to have their broker handle the transaction. This was red flag #1. We negotiated an agreement but as the renewal date approached the Landlord went dark. A bit frustrated, the client contacted the property manager directly. It was apparent from the fact the manager took his call that they wanted to gain as much advantage as possible by not discussing terms through a real estate professional. Fortunately, when the final deal was struck the client was wise enough to send it over to us for review.
The amendment was quite sophomoric and missed several critical issues including confirmation of their security deposit. The client was understandably concerned but didn’t want to upset the landlord. The landlord had become a client of theirs so my client felt he would never do anywrong. Butwhat happens if the building is sold and a new owner interprets the amendment in a way the client felt was contrary to the original intent? The client would not have a leg to stand on.
In another situation a client was given an Estoppel Certificate. We had negotiated a free reserved parking space for the tenant but it was totally verbal and not in the original lease. When the client received the Estoppel we immediately contacted the landlord to remind them of the reserved space the client had been using for almost two years They agreed we could modify the document to note the space.
Two months later the sale went through. As part of the sale, the new owner gave up their rights to an easement for a commonly shared parking structure in which my client’s space was located. The new owner had contacted the 5-6 people who had reserved spaces mentioned in their leases but never looked at our Estoppel. Fortunately, we had made the change on the Estoppel and all three landlords agreed. The space was restored. Had it not been in writing my client would have lost their rights.
Whatever the document, and no matter how big or small your office space is, always negotiate the most favorable terms and put them in writing.