Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

Commercial Leasing Law & StrategyKickerFeaturesSectionsNewsLJN Newsletters

Construction Chargebacks: The Hidden Costs

By Glenn A. Browne
November 30, 2015

Virtually every retail lease contains what is commonly referred to as the “Construction Exhibit.” Certain retail leases divide the Construction Exhibit into several smaller exhibits that address different portions of the tenant's construction work, including plan submittal, application for permits, insurance, lien waivers, signage, security and construction deposits. In addition, virtually every retail lease addresses a category commonly referred to as “chargebacks.” The chargebacks address certain items for which the landlord seeks payment or reimbursement from the tenant for various aspects of the tenant's construction work. These construction chargebacks may include:

  • Barricade charges;
  • Plan review fees/engineering fees;
  • Temporary utilities;
  • Sprinkler drain-down fees; and
  • Fee for work and/or materials provided by the landlord as part of the tenant's construction work.

This article addresses the manner in which retail leases attempt to assess these construction chargebacks, and also discusses the manner in which a tenant should address these construction chargebacks in its comments to the landlord's draft of a retail lease.

Barricade Charges

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
Law Firms are Reducing Redundant Real Estate by Bringing Support Services Back to the Office Image

A trend analysis of the benefits and challenges of bringing back administrative, word processing and billing services to law offices.

Bit Parts Image

Summary Judgment Denied Defendant in Declaratory Action by Producer of To Kill a Mockingbird Broadway Play Seeking Amateur Theatrical Rights

Risks of “Baseball Arbitration” in Resolving Real Estate Disputes Image

“Baseball arbitration” refers to the process used in Major League Baseball in which if an eligible player's representative and the club ownership cannot reach a compensation agreement through negotiation, each party enters a final submission and during a formal hearing each side — player and management — presents its case and then the designated panel of arbitrators chooses one of the salary bids with no other result being allowed. This method has become increasingly popular even beyond the sport of baseball.

Disconnect Between In-House and Outside Counsel Image

'Disconnect Between In-House and Outside Counsel is a continuation of the discussion of client expectations and the disconnect that often occurs. And although the outside attorneys should be pursuing how inside-counsel actually think, inside counsel should make an effort to impart this information without waiting to be asked.

Bankruptcy Sales: Finding a Diamond In the Rough Image

There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.