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As a condition to entering into a new lease, landlords often require a guaranty of lease from a personal or corporate guarantor in connection with those tenant entities that do not have either a high enough net worth or annual revenue, or for whatever other reasons do not meet the landlord’s financial criteria. A guaranty of lease is a covenant by the guarantor to be responsible for the obligations of the tenant. For example, for a tenant business set up as a new limited liability company that has one or two principal owners, the landlord will likely require that the owners personally guaranty the tenant’s obligations under the lease because the limited liability company would have little or no assets and no track record. Or for a tenant entity that is a wholly owned subsidiary of a parent corporation, the landlord will likely require that the parent corporation serve as the guarantor. In these examples, a selective landlord would not enter into the lease without the tenant offering a creditworthy guarantor.
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‘Best Efforts’ Clauses In Commercial Leases
By Gary M. Rosenberg, Alexander Lycoyannis and Michael A. Pensabene
Undefined terms of art such as “best efforts” are often utilized in commercial leases, but the interpretation of those terms and the enforceability of the clause, when left to the courts, will turn on how the lease is drafted.
The Impact of New York’s Greenhouse Gas Law
By Matthew Schneid
New York City's Local Law Number 97 was enacted to amend the New York City Charter and Administrative Code to achieve reductions in greenhouse gas emissions by 2050. This is accomplished by requiring buildings to retrofit their systems with more energy efficient systems or purchase certain permitted carbon offsets.
How to Strike a Deal In a Stagnant Net Lease Market
By Chad Kurz
Transactions have slowed in just about every category for commercial real estate and net lease is no exception. The reasons are myriad for that but let’s boil them down.
Can ChatGPT Take the Place of Real Estate Lawyers?
By Tony Alfonso
While we marvel at the myriad applications of ChatGPT, it’s important to note that this newly introduced tool has nuances which can create problems if misunderstood — especially when attempting to produce legal documents or legal advice in real estate transactions.
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