Jul 20

Tenant Improvement Allowance and Landlord Defaults, guest post by Justin Daniels, Atlanta Real Estate Attorney

Your Tenant Improvement Allowance is at risk When a Landlord Defaults

Certain commercial leases allow a tenant to build out space and be reimbursed by the landlord for such buildout. In the current economic climate, however, a landlord may be having financial difficulty or default on its mortgage and be unable to reimburse the tenant for the buildout. This does not, however, relieve the tenant from paying the contractors who performed the buildout work.  As a result, prospective tenant’s should pay attention to landlord’s who are having financial difficulties and also consider performing financial due diligence on the landlord.

About Justin Daniels

Justin S. Daniels is the trusted legal quarterback providing corporate and commercial real estate advice to fast growing privately held entrepreneurial businesses. He practices law as a shareholder with the firm Wagner Johnston & Rosenthal, P.C. Justin's corporate practice consists of representing businesses and business owners in all aspects of their operations from structuring new ventures, advising on acquisitions and divestitures and reviewing and negotiating key vendor, franchise, employment and customer contracts. He has represented a variety of clients in the manufacturing, retail, professional services, consulting and technology industries.
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  • http://twitter.com/TheAcresGroup The Acres Group

    I'd like to add we're seeing landlords hesitating to pay tenant improvement allowances to tenants due to the number of tenant defaulting on their leases. No landlord wants to shell out a lump sum of cash only to see the tenant vacate a little ways down the road…

  • http://twitter.com/TheAcresGroup The Acres Group

    I'd like to add we're seeing landlords hesitating to pay tenant improvement allowances to tenants due to the number of tenant defaulting on their leases. No landlord wants to shell out a lump sum of cash only to see the tenant vacate a little ways down the road…

  • Adam Williams

    Well said, There are many landlords facing the financial difficulties here. A little help can help them save their business.