Adam Bothun 
A recapture right is one of the most powerful tools a commercial landlord holds. It allows the landlord to take back leased space when the tenant asks for permission to sublease or assign the lease. Instead of approving the transfer, the landlord can terminate the lease for that space and rent it directly to the … Read more
When a tenant subleases commercial space for more than the rent owed to the landlord, the extra money does not always stay with the tenant. Many commercial leases include profit-sharing clauses that give the landlord a cut of any sublease profit. These clauses often work hand in hand with recapture rights, which let the landlord … Read more
When a landlord wants extra assurance that rent will be paid, two instruments often come up: a lease guaranty and a surety bond. Both give the landlord someone to turn to if the tenant defaults. They work very differently, cost different amounts, and create different risks. Choosing the wrong one can cost you money, flexibility, … Read more
A personal guarantee makes you personally responsible for a lease signed by your business. If the company cannot pay the rent, the landlord can come after your house, your savings, and your personal bank accounts. For small business owners, this single clause is often the scariest part of a commercial lease, and for good reason. … Read more
Prepaid rent means paying rent before it is due, sometimes months or even a full year in advance. Some tenants offer it voluntarily to win a competitive apartment or to compensate for weak credit. Some landlords request it as extra security. Either way, handing over a large sum before you have lived a single day … Read more
A letter of credit is a bank’s promise to pay. When used as lease security, it replaces or supplements the traditional cash security deposit with a financial instrument issued by the tenant’s bank in the landlord’s favor. If the tenant defaults, the landlord presents a demand to the bank and gets paid, usually within days. … Read more
A landlord’s lien gives the landlord a legal claim against a tenant’s personal property as security for unpaid rent. In plain terms, it can mean the landlord has the right to keep your furniture, equipment, or inventory if you fall behind on rent. For residential tenants this sounds alarming, and in most states it is … Read more
A limitation of liability clause puts a ceiling on how much one party can owe the other. In commercial leases, these clauses are the landlord’s favorite safety valve. They cap damages at a fixed dollar amount, at a multiple of rent, or at the value of the landlord’s interest in the property. Tenants rarely notice … Read more
Indemnification clauses decide who pays when something goes wrong. In a lease, an indemnity provision can shift the entire cost of a lawsuit, a property damage claim, or an injury from one party to the other. Few tenants appreciate how much money is on the line until a slip and fall in their store leads … Read more
A waiver of subrogation is one of those lease clauses that looks like harmless legal boilerplate until a claim actually happens. It sits quietly in the insurance section of a commercial lease, often only a sentence or two long, and most tenants sign it without a second thought. That quiet clause, however, decides whether an … Read more