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Land Lease: See “Ground Lease.” Landlord Approval | Landlord Consent: A situation in which a tenant must get the permission of landlord before proceeding with its course of action. Generally, situations…
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Introduction: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 1)
Part 1 Introduction: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter When negotiating a letter of intent (“LOI”), although it is my belief that the…
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Leverage: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 2)
Part 2 Leverage: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter Trying to take a step down from my virtual soapbox without pulling my hamstring,…
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Use of the Premises: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 3)
Part 3 Use of the Premises: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter In an ideal world, given that having an “exit strategy” both…
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The Lease Term & Delivery of the Premises: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 4)
Part 4 The Lease Term & Delivery of the Premises: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter Welcome back to Part 4 of our…
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Determining the Appropriate Lease Term: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 5)
Part 5 Determining the Appropriate Lease Term: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter As the legendary actor, director and Sundance Film Festival creator…
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Base Rent & Free Rent: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 6)
Part 6 Base Rent & Free Rent: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter When it comes to establishing what the rent is going…
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Renewal Options: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 7)
Part 7 Renewal Options: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter A compelling and convincing argument can be made that the inclusion of a…
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Operating Expense Escalations & Percentage Rent Increases: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 8)
Part 8 Operating Expense Escalations & Percentage Rent Increases: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter In many leases, in addition to a real…
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Real Estate Tax Escalations: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 9)
Part 9 Real Estate Tax Escalations: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter Somewhat analogous to the line by comedian Tracy Morgan where he…
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Security Deposits: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 10)
Part 10 Security Deposits: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter Borrowing from our multi-part series on negotiating security deposits and good guy guarantees,…
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Good Guy Guarantees: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 11)
Part 11 Good Guy Guarantees: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter At its most basic level, a GGG is a document wherein a…
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Loss Factors: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 12)
Part 12 Loss Factors: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter As a general rule, when contrasted with the usable square footage of a…
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Assignment & Subletting: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 13)
Part 13 Assignment & Subletting: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter As I have previously pointed out ad nauseam in both our 15…
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Electricity: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 14)
Part 14 Electricity: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter When it comes to an electricity provision in a LOI, paraphrasing the words and…
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Tenant’s Early Access: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 15)
Part 15 Tenant’s Early Access: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter Playing off of the title of the song “Distant Early Warning” by…
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HVAC/Air Conditioning: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 16)
Part 16 HVAC/Air Conditioning: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter With due props out to rock and roll legends Foreigner and Buster Poindexter,…
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Landlord’s Work: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 17)
Part 17 Landlord’s Work: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter In a landlord’s ideal (and sometimes fantasy) world, its Landlord’s Work LOI provision…
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Tenant’s Work: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 18)
Part 18 Tenant’s Work: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter To witness the transformation of an office or retail space from that of,…
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Signage & Scaffolding: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 19)
Part 19 Signage & Scaffolding: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter It is my belief that a fairly decent number of retailers truly…
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Subordination and SNDA’s: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 20)
Part 20 Subordination and SNDA’s: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter Welcome back my leasing brothers and sisters to what I hope will…
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Hazardous Materials: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 21)
Part 21 Hazardous Materials: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter From a landlord perspective, one of the many ancillary benefits of only having…
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Cleaning: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 22)
Part 22 Cleaning: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter While we are on the subject of having a tenant’s become space spic and…
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Compliance with Law: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 23)
Part 23 Compliance with Law: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter In most commercial leases, landlords – in a seemingly subtle, yet relentless…
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Conclusion: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 24)
Part 24 Conclusion: Negotiating and Preparing a Letter of Intent (“LOI”) Previous ChapterTable of ContentsNext Chapter It’s time my friends to put a wrap on our multi-part series on preparing…
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The Letter of Intent (“LOI”) from Semi-Hell
October 3, 2018 Eddie Norton Top Landlord Broker, LLC 111 Sixth Avenue New York, NY 10003 RE: 59 Desirable Avenue – Store #1, New York, NY (“Premises”) Dear Eddie:…
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Leverage & Setting the Negotiating Playing Field within a Letter of Intent (“LOI”)
Leverage Tenant Advocates: A tenant never has more leverage in its negotiations with landlord than during the LOI preparation and negotiation stage. Once the LOI terms have been agreed to the…
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Use Clauses within a Letter of Intent (“LOI”)
Landlord Advocates: Keep it narrow. Keep the LOI and any definitions as narrow as possible. This will lure the prospective tenant into the lease negotiation stage – where tenants will…
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Use Clause Restrictions within a Letter of Intent (“LOI”)
Examples of Use Restriction Language Notwithstanding anything to the contrary contained in this Lease, Tenant agrees that it and anyone holding through Tenant shall not use, sublet or assign all…
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The Lease Term, Delivery of/Failure to Deliver the Premises and Establishing the Lease Term within a Letter of Intent (“LOI”) (Part 1 of 2)
The Lease Term & How Should It Read from a Tenant’s Perspective “Ten (10) years and eight (8) months, commencing ten (10) days after Tenant’s receipt of written notice from…
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The Lease Term, Delivery of/Failure to Deliver the Premises and Establishing the Lease Term within a Letter of Intent (“LOI”) (Part 2 of 2)
Determining the Appropriate Lease Term Landlord Advocates: The longer the lease term for a secure and rent-paying tenant, the better it will generally be when they go to refinance and/or…
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Base Rent and Free Rent within a Letter of Intent (“LOI”)
Base Rent Negotiation Landlord Advocates: Whether one prefers to call it “fixed” or “base,” landlord advocates should push for as high a rent as possible when negotiating a LOI. They should…
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Renewal Options within a Letter of Intent (“LOI”) (Part 1 of 2)
Incentivizing Tenant Renewal Landlord & Tenant Advocates: If a landlord has a reliable tenant in possession of the premises, it may be prudent to incentivize the tenant to stay and…
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Renewal Options within a Letter of Intent (“LOI”) (Part 2 of 2)
Timing is Everything Landlord Advocates: During the LOI stage, more often than not it is best to remain silent and leave it to the lease negotiation stage as to when…
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Renewal Option
“Tenant or Tenant’s parent, affiliate, subsidiary or permitted assignee or subtenant shall have the right to renew this Lease (“Renewal Option”) at its option for two (2) additional terms of…
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Security Deposits within a Letter of Intent (“LOI”)
Determining the Amount and Type of Security Deposit Landlord Advocates: Borrowing from our multi-part series on negotiating security deposits and good guy guarantees, landlord advocates need to ask themselves the…
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Sweet 16 List of Financial & Non-Financial Concerns for Determining the Security Deposit (“S/D”)
Sweet 16 List The strength of tenant’s Profit & Loss Statement The strength of tenant’s balance sheet Tenant’s historical track record Is it office or retail? “Think” more outlay by…
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Good Guy Guarantees (“GGG”) within a Letter of Intent (“LOI”)
Good Guy Guaranty LOI Negotiating Pointers At its most basic level, a GGG is a document wherein a tenant’s principal or principals personally guarantee that all rent will be paid…
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Top Examples of Legal and Business Steroids a Landlord Will Use to Strengthen a GGG (and Tenant’s Potential Counteractions)
Legal and Business Steriods Landlord Action: Guaranty of not only Base Rent but Additional Rent Tenant Action: Given that Additional Rent is defined broadly, tenants should attempt to limit its…
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Operating Expense Escalations & Percentage Rent Increases within a Letter of Intent (“LOI”)
In many leases, in addition to a real estate tax escalation, among the more popular (or unpopular, depending on your perspective) rent escalation provisions are those which require the tenant…
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Defining Operating Expenses
Typically, at their most basic level, operating expenses of a building include those attributable to: Ownership, management, maintenance and operating expenses Insurance premiums and deductibles Wages, salaries and benefits of…
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Operating Expense Definitional Carve-Outs and Limitations
Landlord Advocates: A landlord’s operating expense definition should contain as much as possible -including the kitchen sink. With that said, Leasing REality strongly suggests that landlords add, immediately after their…
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Establishing Tenant’s Pro-Rata Share of Tax Increases
When negotiating a myriad of pro-tenant carve-outs to a real estate tax escalation clause, tenant advocates should consider being selective when doing so. Never give a landlord or anyone for…
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Miscellaneous Real Estate Tax Clause Tips
Business Improvement District Charges: As a straight pass-through, landlords should attempt to pass any business improvement district (“BID”) charges on to their tenant based on their proportion share of same.…
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Loss Factors, Useable vs. Rentable Square Feet and Space (Re-) Measurement Negotiating Pointers
As a general rule, when contrasted with the useable square footage of a space, seemingly all landlords consider their space’s rentable square footage (“RSF”) calculation to be non-negotiable. Consequently, from…
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Re-Measurement within a Letter of Intent (“LOI”)
“Tenant shall have the option, exercisable by written notice to Landlord within thirty (30) days after delivery of the Premises to Tenant, to verify the gross leasable area (“GLA”) of…
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Assignment and Subletting Letter of Intent (“LOI”) Negotiating Pointers (Part 1 of 3)
The Assignment & Subletting Playing Field The assignment and subletting clause is arguably the most important clause to negotiate in a lease and although a letter of intent (“LOI”) or…
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Assignment and Subletting Letter of Intent (“LOI”) Negotiating Pointers (Part 2 of 3)
Landlord Advocates: It would be useful to point out that a well-drafted lease provision should begin with language detailing what a landlord will need from its tenant in the event…
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Assignment and Subletting Letter of Intent (“LOI”) Negotiating Pointers (Part 3 of 3)
Sample Pro-Tenant LOI Provisions (which fold in all or most of the foregoing leasing pointers noted in Parts 1 and 2) Subletting and Assignment “Tenant shall have the right to…
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Pro-Tenant Assignment & Subletting within a Letter of Intent (“LOI”)
“Tenant shall have the right to assign or sub-lease all or any portion of the Premises to a third party entity, subject to Landlord’s approval with explanation, which will not…
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Pro-Tenant Space Sharing within a Letter of Intent (“LOI”)
“Subject to the terms and conditions of the Lease, on prior notice to Landlord accompanied by a certificate of insurance, without Landlord’s consent, Tenant shall have the right to permit…
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Electricity Letter of Intent (“LOI”) Negotiating Pointers (Part 1 of 2)
When it comes to an electricity provision in a LOI, paraphrasing the words and wisdom of Forrest Gump, who, if negotiating a lease, very well would have said something along…
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Electricity Letter of Intent (“LOI”) Negotiating Pointers (Part 2 of 2)
Electrical Capacity and Power Tenant Advocates: For office tenants, the question to be asked is whether or not the space has sufficient amperage based on your usage type. If it…
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The Snagglepuss, Groucho Marx, The Clash & Steve McQueen Great Escape Theory
Negotiating Theories to Succeed in Life, Marketing and Commercial Leasing (Part 2) As a tenant advocate, it is imperative that you create exit strategies for your client as early as…
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Introduction: Negotiating & Preparing a Letter of Intent (“LOI”) (Part 1)
(Part 1 of 24) | 8:13 Table of Contents
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Leverage: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 2)
(Part 2 of 24) | 4:47 Table of Contents
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Use of the Premises: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 3)
(Part 3 of 24) | 9:37 Table of Contents
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The Lease Term & Delivery of the Premises: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 4)
(Part 4 of 24) | 5:26 Table of Contents
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Determining the Appropriate Lease Term: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 5)
(Part 5 of 24) | 4:28 Table of Contents
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Base Rent & Free Rent: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 6)
(Part 6 of 24) | 10:38 Table of Contents
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Renewal Options: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 7A)
(Part 7A of 24) | 8:39 Table of Contents
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Renewal Options: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 7B)
(Part 7B of 24) | 6:57 Table of Contents
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Operating Expense Escalations & Percentage Rent Increases: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 8A)
(Part 8A of 24) | 10:20 Table of Contents
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Operating Expense Escalations & Percentage Rent Increases: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 8B)
(Part 8B of 24) | 8:04 Table of Contents
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Real Estate Tax Escalations: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 9A)
(Part 9A of 24) | 5:56 Table of Contents
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Real Estate Tax Escalations: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 9B)
(Part 9B of 24) | 11:29 Table of Contents
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Security Deposits: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 10)
(Part 10 of 24) | 8:47 Table of Contents
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Good Guy Guarantees: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 11)
(Part 11 of 24) | 11:07 Table of Contents
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Loss Factors: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 12)
(Part 12 of 24) | 6:49 Table of Contents
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Assignment & Subletting: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 13)
(Part 13 of 24) | 10:36 Table of Contents
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Electricity: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 14)
(Part 14 of 24) | 11:16 Table of Contents
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Tenant’s Early Access: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 15)
(Part 15 of 24) | 6:35 Table of Contents
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HVAC/Air Conditioning: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 16)
(Part 16 of 24) | 8:25 Table of Contents
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Landlord’s Work: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 17)
(Part 17 of 24) | 8:05 Table of Contents
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Tenant’s Work: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 18)
(Part 18 of 24) | 8:58 Table of Contents
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Signage & Scaffolding: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 19)
(Part 19 of 24) | 11:19 Table of Contents
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Subordination and SNDA’s: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 20)
(Part 20 of 24) | 6:11 Table of Contents
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Hazardous Materials: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 21)
(Part 21 of 24) | 3:12 Table of Contents
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Cleaning: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 22)
(Part 22 of 24) | 4:24 Table of Contents
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Compliance with Law: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 23)
(Part 23 of 24) | 2:59 Table of Contents
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Conclusion: Negotiating and Preparing a Letter of Intent (“LOI”) (Part 24)
(Part 24 of 24) | 9:10 Table of Contents
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Tenant’s Early Access within a Letter of Intent (“LOI”)
Tenant Advocates: Playing off of the title of the song “Distant Early Warning” by Canadian rock band Rush, it is never too early to inform the landlord of the necessity…
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HVAC/Air Conditioning within a Letter of Intent (“LOI”)
Tenant Advocates: The majority of leases do not address what minimum temperature must be maintained by the building owner in the winter or what maximum temperature you must endure during the high…
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Landlord’s Work within a Letter of Intent (“LOI”)
Landlord Advocates: Ideally, a Landlord’s Work LOI provision would state that “Tenant accepts the premises “as-is”,” in order to generally: relieve the landlord of any liability as to the condition of…
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Tenant’s Work within a Letter of Intent (“LOI”)
When it comes to a tenant taking much more than a hammer to hang a picture frame within its premises, in the eyes of many landlords, it is their preordained…
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Signage, Scaffolding & Awning Provisions within a Letter of Intent (“LOI”)
It’s our belief that part of a retailer’s job description is to show potential customers, as the silky smooth The Weeknd might croon, the “Beauty Behind the Madness” of their store. Short of being…
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Subordination and SNDA’s within a Letter of Intent (“LOI”)
In short, subordination is a provision requiring that a tenant’s lease be subordinate to any existing or future mortgage of landlord on the building as well as any existing or…
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Hazardous Materials within a Letter of Intent (“LOI”)
From a landlord perspective, one of the many ancillary benefits of only having to deliver the space to a tenant in its “as-is” condition is that effectively, the tenant will…
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Cleaning within a Letter of Intent (“LOI”)
Simply stated, the LOI provision should provide whether the tenant or landlord will clean the premises, which party will pay for such cleaning, and the frequency and manner at which…
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Compliance with Law within a Letter of Intent (“LOI”)
In most commercial leases, landlords – in a seemingly subtle, yet relentless manner – attempt to shift the legal and financial burden of compliance with applicable laws pertaining to its…
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The Power and Impact of a Letter of Intent (“LOI”)
The power of the Letter of Intent (“LOI”) and the impact made by those preparing them cannot be understated. Landlord Advocates: A landlord’s mantra should be that of brevity, simplicity and…
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