Like other types of contracts, a commercial lease between oneself and a landlord may be negotiated. However, effective negotiation in Los Angeles starts with an understanding of the terms often included in commercial leases. These terms include destruction, enforcement and escalation clause. An important clause to search for in a commercial lease is one that deals with destruction. This clause essentially makes it mandatory for a landlord to rebuild the property being leased if this property ends up being destroyed. The clause explains whether the tenant’s rate will end up being abated and if tenant has the option of terminating the lease in the event the building is either partially or totally destroyed. Yet another aspect of a commercial lease to consider is enforcement. An enforcement clause specifies how the contract will be enforced. In addition, many businesses will negotiate into their leases a clause that requires all parties to resolve disputes that arise via arbitration or mediation. Another important term to consider when dealing with leases is the escalation clause. This clause provides for rent increases during a specific amount of time. Tenants may benefit from ascertaining how exactly these increases are determined; for instance, they may be tied to a landlord’s operating costs or to an outside index. Various types of commercial leases are available to those who need office or retail spaces as well as those who need space for manufacturing or other industrial uses. All of these types of leases can be challenging to work whether one is a potential tenant or a landlord. However, an attorney in Los Angeles can help with negotiating and drafting as well as reviewing these essential documents. Source: findlaw.com, “ Commercial Lease Provisons “, Accessed on Aug. 23, 2017
Protecting your project from defective construction
The process of preparing for a complicated building project may be more intense than the construction itself. With countless unknowns, it is difficult to assess your risk and prepare for every contingency. Your contractors have the responsibility of ensuring they meet their obligations with as little negative impact as possible. Unfortunately, many contractors you deal with may be facing a shortage of skilled and trained workers. This alone may increase the likelihood of defective workmanship. However, it is not the only factor for which you have to prepare. Common construction defects As California draws closer to the deadline for net-zero energy conservation, contractors should be applying more rigid standards to installing insulation. The newer high-efficiency exterior insulation requires more time and skill to install in conjunction with interior batt insulation. If done incorrectly, the results include higher energy use and more expense for you. One of the most common and damaging results of construction defects is water intrusion. Whether it is poorly constructed roofs, windows, doors, exteriors or foundation, any source that allows water to enter your structure can result in mold, warping and rot. Water intrusion can come from any of the following: Insufficient flashing Poorly installed building wrap Improperly completed architectural plan Inappropriate choice of materials Inadequately trained laborers These are only a few of the issues that may lead you to consider construction defect litigation. It is important to note that water intrusion is only one result of defective construction. You certainly would not want to take the risk of a poorly executed construction plan resulting in tragedy when an unsound structure collapses or fails to hold up under common California conditions, such as heavy rains or earthquakes. How do I protect myself from risk? You can make sure all the entities involved in your project carry the appropriate insurance to protect against construction issues that may arise. But how do you know if the certificates your contractors hold truly provide coverage? And how do you know if the coverage is adequate for the risk involved? Seeking the advice of an attorney with years of experience reviewing and evaluating the insurance requirements for your project may help you avoid many of the negative consequences possible in a major construction project. Many builders and property owners find it is better to take these steps as early as possible rather than discover in the midst of a challenge that the risk is not covered.
Protecting your project from defective construction
The process of preparing for a complicated building project may be more intense than the construction itself. With countless unknowns, it is difficult to assess your risk and prepare for every contingency. Your contractors have the responsibility of ensuring they meet their obligations with as little negative impact as possible. Unfortunately, many contractors you deal with may be facing a shortage of skilled and trained workers. This alone may increase the likelihood of defective workmanship. However, it is not the only factor for which you have to prepare. Common construction defects As California draws closer to the deadline for net-zero energy conservation, contractors should be applying more rigid standards to installing insulation. The newer high-efficiency exterior insulation requires more time and skill to install in conjunction with interior batt insulation. If done incorrectly, the results include higher energy use and more expense for you. One of the most common and damaging results of construction defects is water intrusion. Whether it is poorly constructed roofs, windows, doors, exteriors or foundation, any source that allows water to enter your structure can result in mold, warping and rot. Water intrusion can come from any of the following: Insufficient flashing Poorly installed building wrap Improperly completed architectural plan Inappropriate choice of materials Inadequately trained laborers These are only a few of the issues that may lead you to consider construction defect litigation. It is important to note that water intrusion is only one result of defective construction. You certainly would not want to take the risk of a poorly executed construction plan resulting in tragedy when an unsound structure collapses or fails to hold up under common California conditions, such as heavy rains or earthquakes. How do I protect myself from risk? You can make sure all the entities involved in your project carry the appropriate insurance to protect against construction issues that may arise. But how do you know if the certificates your contractors hold truly provide coverage? And how do you know if the coverage is adequate for the risk involved? Seeking the advice of an attorney with years of experience reviewing and evaluating the insurance requirements for your project may help you avoid many of the negative consequences possible in a major construction project. Many builders and property owners find it is better to take these steps as early as possible rather than discover in the midst of a challenge that the risk is not covered.
Many types of commercial leases available
Those interested in commercial leases in Los Angeles may understandably be overwhelmed by the various types of terms of agreements available. Unfortunately, entering the wrong types of agreements for commercial leases can be financially devastating long term. Comparing the many options and the possible expenses, beyond just monthly rental amounts, is paramount. One type of commercial lease is a fixed or flat lease, where a particular rent is established for a certain time period. A gross lease is another option for a small business owner. With this option, the tenant will pay a flat amount each month, and the landlord will pay for any building operating costs. In some situations, the tenant will also pay for air conditioning, electricity and heat. Such a lease typically features an escalation clause, which lets the landlord boost the rent each year to make up for increasing expenses. A third lease option is a step lease. With such a lease, the rent rises by a particular amount each year during the agreement’s life. This increase is helpful for covering the expected expense increases that the landlord will incur. The increase, however, is based not on actual costs but on estimated costs. With the many options for commercial leases available, an attorney can provide business owners with much-needed insight into potential lease agreements. Then, the attorney can negotiate leases on their behalf. The attorney’s ultimate goal is to ensure that a Los Angeles business owner’s best interests are represented at all stages of the process. Source: Findlaw, “ Types of Leases “, Accessed on July 13, 2017
Many types of commercial leases available
Those interested in commercial leases in Los Angeles may understandably be overwhelmed by the various types of terms of agreements available. Unfortunately, entering the wrong types of agreements for commercial leases can be financially devastating long term. Comparing the many options and the possible expenses, beyond just monthly rental amounts, is paramount. One type of commercial lease is a fixed or flat lease, where a particular rent is established for a certain time period. A gross lease is another option for a small business owner. With this option, the tenant will pay a flat amount each month, and the landlord will pay for any building operating costs. In some situations, the tenant will also pay for air conditioning, electricity and heat. Such a lease typically features an escalation clause, which lets the landlord boost the rent each year to make up for increasing expenses. A third lease option is a step lease. With such a lease, the rent rises by a particular amount each year during the agreement’s life. This increase is helpful for covering the expected expense increases that the landlord will incur. The increase, however, is based not on actual costs but on estimated costs. With the many options for commercial leases available, an attorney can provide business owners with much-needed insight into potential lease agreements. Then, the attorney can negotiate leases on their behalf. The attorney’s ultimate goal is to ensure that a Los Angeles business owner’s best interests are represented at all stages of the process. Source: Findlaw, “ Types of Leases “, Accessed on July 13, 2017
Investors may see value in Napa purchases, commercial leases
Even as real estate values in Los Angeles continue to skyrocket this year, the assessed value of property in Napa County has gone up. Specifically, the value has jumped by a whopping $2.4 billion for the tax year of 2017 to 2018. Those interested in investing in commercial properties and offering commercial leases in this part of California are certainly happy to hear this news. The $2.4 billion increase is the biggest in Napa County history. In fact, the county’s value went up more in a single year than the total value of the county’s property was 37 years ago. Right now, the county’s property is valued at more than $37 billion, versus a little over $2.3 billion in 1980. The roll for 2017 to 2018 was up nearly 7 percent, reflecting significant nonresidential construction as well as rising residential values. Nonresidential new construction, in particular, added nearly $240 million in assessed value. This is the third-biggest increase since the year of 1990. All cities in Napa County showed assessed-value increases, with assessed values providing property tax revenue. Those interested in purchasing commercial buildings and making commercial leases available to businesses in Los Angeles or other parts of the state of California, where property values are going strong, certainly have great potential for enjoying profits in the long run. However, navigating a transaction can be stressful and can end up being costly from a financial standpoint if not handled properly. An attorney can help ensure that one’s desires and best interests are upheld when engaged in real estate transactions in the Golden State. Source: napavalleyregister.com, “ Napa County’s property assessment roll soars to new heights “, July 18, 2017
Investors may see value in Napa purchases, commercial leases
Even as real estate values in Los Angeles continue to skyrocket this year, the assessed value of property in Napa County has gone up. Specifically, the value has jumped by a whopping $2.4 billion for the tax year of 2017 to 2018. Those interested in investing in commercial properties and offering commercial leases in this part of California are certainly happy to hear this news. The $2.4 billion increase is the biggest in Napa County history. In fact, the county’s value went up more in a single year than the total value of the county’s property was 37 years ago. Right now, the county’s property is valued at more than $37 billion, versus a little over $2.3 billion in 1980. The roll for 2017 to 2018 was up nearly 7 percent, reflecting significant nonresidential construction as well as rising residential values. Nonresidential new construction, in particular, added nearly $240 million in assessed value. This is the third-biggest increase since the year of 1990. All cities in Napa County showed assessed-value increases, with assessed values providing property tax revenue. Those interested in purchasing commercial buildings and making commercial leases available to businesses in Los Angeles or other parts of the state of California, where property values are going strong, certainly have great potential for enjoying profits in the long run. However, navigating a transaction can be stressful and can end up being costly from a financial standpoint if not handled properly. An attorney can help ensure that one’s desires and best interests are upheld when engaged in real estate transactions in the Golden State. Source: napavalleyregister.com, “ Napa County’s property assessment roll soars to new heights “, July 18, 2017
Industrial and commercial leases remain promising
In California, a development company called Stirling Development recently announced its execution of an industrial lease with the consumer goods company Newell Brands for a distribution center. The lease is for a space spanning 195,508 square feet. Industrial or commercial leases such as this one continue to be a promising area of real estate in Los Angeles and other parts of the Golden State. The facility where the lease was recently executed with Newell Brands is 370,023 square feet in size and is located at an airport. This transportation hub includes a huge industrial and commercial complex. The facility ended up being finished ahead of schedule despite the excess rains that occurred this year and the large size of the building. Newell Brands has actually been a tenant at the airport since 2007. However, with the recently executed lease, Newell Brands will now take up more than a million square feet at the airport. The benefit of such big-box leases in this area of California is that they are about 66 percent of the cost of the facilities found in other regional markets. This cost savings is attractive to distribution and manufacturing users. Although the process of executing the lease with Newell Brands appears to have gone smoothly, not all situations involving industrial or commercial leases are without major hurdles. Before signing a lease, understanding all of the terms of the lease is paramount. An attorney in Los Angeles can help with reviewing a lease document as well as negotiating a lease to ensure that the potential lessee’s best interests are protected. Source: inlandempire.us, “ Newell Brands Leases 195,508 sf Industrial Space At Southern California Logistics Airport “, June 27, 2017
Industrial and commercial leases remain promising
In California, a development company called Stirling Development recently announced its execution of an industrial lease with the consumer goods company Newell Brands for a distribution center. The lease is for a space spanning 195,508 square feet. Industrial or commercial leases such as this one continue to be a promising area of real estate in Los Angeles and other parts of the Golden State. The facility where the lease was recently executed with Newell Brands is 370,023 square feet in size and is located at an airport. This transportation hub includes a huge industrial and commercial complex. The facility ended up being finished ahead of schedule despite the excess rains that occurred this year and the large size of the building. Newell Brands has actually been a tenant at the airport since 2007. However, with the recently executed lease, Newell Brands will now take up more than a million square feet at the airport. The benefit of such big-box leases in this area of California is that they are about 66 percent of the cost of the facilities found in other regional markets. This cost savings is attractive to distribution and manufacturing users. Although the process of executing the lease with Newell Brands appears to have gone smoothly, not all situations involving industrial or commercial leases are without major hurdles. Before signing a lease, understanding all of the terms of the lease is paramount. An attorney in Los Angeles can help with reviewing a lease document as well as negotiating a lease to ensure that the potential lessee’s best interests are protected. Source: inlandempire.us, “ Newell Brands Leases 195,508 sf Industrial Space At Southern California Logistics Airport “, June 27, 2017
Commercial buildings with commercial leases can be tricky to sell
In Southern California, there are currently several more buyers than there are sellers. As a result, sellers have the upper hand. This may be helpful information for Los Angeles investors who own commercial properties and offer commercial leases but might be interested in selling their properties. Selling a commercial property can be tricky, and those trying to sell their properties may experience hurdles for a number of reasons. First, their buildings may be overpriced. It can be helpful to view recently closed sales and compare them with what is currently available on the market, checking for upward and downward trends. This is essential in determining the value of a building to be sold. Another reason selling a commercial building in California may be difficult is that it is lacking an important amenity. For instance, logistics buildings that have low ceilings, or spaces with challenged loadings, may be challenging to move. Another potentially difficult-to-move property is a service depot that does not have a storage area in which to keep trucks outside. Use restrictions are another important consideration when selling commercial property, as a buyer may not be able to use one’s for-sale property in the way he or she needs it to be used. Having realistic expectations is paramount when it comes time to sell a commercial building, including one offering commercial leases, in Los Angeles. An attorney can help with navigating each step of a commercial real estate deal so that one’s needs and desires are met. The attorney’s ultimate goal is to ensure that one’s rights are protected and that a personally favorable outcome is attained, considering the circumstances surrounding the deal. Source: ocregister.com, “ Commercial real estate: 5 reasons your building isn’t sold yet “, Allen Buchanan, July 22, 2017
Commercial buildings with commercial leases can be tricky to sell
In Southern California, there are currently several more buyers than there are sellers. As a result, sellers have the upper hand. This may be helpful information for Los Angeles investors who own commercial properties and offer commercial leases but might be interested in selling their properties. Selling a commercial property can be tricky, and those trying to sell their properties may experience hurdles for a number of reasons. First, their buildings may be overpriced. It can be helpful to view recently closed sales and compare them with what is currently available on the market, checking for upward and downward trends. This is essential in determining the value of a building to be sold. Another reason selling a commercial building in California may be difficult is that it is lacking an important amenity. For instance, logistics buildings that have low ceilings, or spaces with challenged loadings, may be challenging to move. Another potentially difficult-to-move property is a service depot that does not have a storage area in which to keep trucks outside. Use restrictions are another important consideration when selling commercial property, as a buyer may not be able to use one’s for-sale property in the way he or she needs it to be used. Having realistic expectations is paramount when it comes time to sell a commercial building, including one offering commercial leases, in Los Angeles. An attorney can help with navigating each step of a commercial real estate deal so that one’s needs and desires are met. The attorney’s ultimate goal is to ensure that one’s rights are protected and that a personally favorable outcome is attained, considering the circumstances surrounding the deal. Source: ocregister.com, “ Commercial real estate: 5 reasons your building isn’t sold yet “, Allen Buchanan, July 22, 2017
Real estate investment partnerships may benefit from vacant sites
Virtually all commercial real estate markets, including those in Los Angeles, have sites that appear to remain vacant no matter the curb appeal or location quality. In fact, these sites may stay vacant for several years and eventually develop a stigma among real estate buyers. However, savvy investors in real estate investment partnerships may be able to turn these sites into profitable treasures. A little statistically strong data and imagination are all that real estate investors need. For instance, real estate professionals can use geospatial analyses to facilitate urban gentrification and revitalization. Revitalization is possible by pinpointing successful businesses that can take up vacant spaces rather than dealing with the hassle and cost of new construction. When aiming to revitalize a struggling site, examining the marketplace locally to determine what might be missing in the way of services or products is critical. However, in addition to deciding on what is missing, considering the demand for these products or services is also important. For instance, in some areas, pet supply shops, specialty food stores and frozen yogurt shops are simply not in high demand compared with other locales. Entering a real estate investment partnership to embark on a commercial project can be a daunting process. However, an attorney can provide guidance with the acquisition of commercial real estate and the formation of real estate investment partnerships. The attorney can additionally help with addressing partnership disputes so that one’s personal goals and best interests are ultimately protected in the potentially promising Los Angeles real estate market. Source: bizjournals.com, “ How real estate professionals can revitalize a failed site “, Alexander Martonik, June 15, 2017
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