Leases are renowned for being landlord-friendly. Tenants need an experienced advocate to negotiate some the “gotchas” out of the contract and level the
playing field. Yet there is one powerful legal precept that tenants often overlook that can give them leverage, sometimes enough to renegotiate their lease or even terminate it if necessary…or desired.
It is an innocuous term buried deep in the document called “quiet enjoyment” and it states that the tenant
has the right to access and use the leased premises for their intended purpose, whether they be office, retail or industrial. Anything ostensibly under the control of the landlord that interferes or interrupts these rights can and should be dealt with seriously.
As a tenant rep broker, I was recently referred to a business that was projecting significant growth over the next couple of years. They needed larger offices that could accommodate the expansion of the sales and marketing staff. The problem was, they were only halfway through their four year lease. When I arrived for my first meeting with the tenant, there was a security
guard posted at the main entrance of the three story building directing people to the stairs because both elevators were out of order. He looked bored. “How long have you been here?” I asked.
“Three weeks” he answered.
I bounded up the stairs two at a time to my prospective client’s offices (on the third floor, by the way) and immediately asked them about the elevators. They said the building had sold about six months earlier and the elevators had been down for several weeks. According to the new property manager, they would be down for two more months. My advice: call
a good real estate attorney and make a case for an interruption of quiet enjoyment. (Note…and an important one: a good real estate broker should understand the context and intent of the legal provisions of the lease but when it comes to defending the tenant or pressing the case to the landlord, one should always defer to an
attorney.)
The window to negotiate lease terms typically closes once the contract is signed but this situation pried it wide open again for this tenant. With a little help from an experienced broker and a skilled attorney, they had the leverage to recast the deal to fit their evolving business
plan.
When” quiet enjoyment” is violated, make some noise.
