When negotiating an option in favor of the tenant to extend the term or expand the leased premises at a later date, the issue of how to determine the economic terms of that extension or expansion can be a contentious one.
In the Spotlight: Confronting the Vagaries of 'Fair Market Rent'
While in its essence a straightforward concept, fair market rent is rife with legal and economic hazards, and parties to a lease are wise to take caution in arriving at an agreed method of calculation.
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