To take advantage of a commercial property in California can be a great opportunity. Forbes explains how when you sign a lease, there is always going to be some amount of risk involved. If you know the risks, you may be able to make a more informed decision. When you set out to sign your commercial lease, there are a few factors to know.

Be aware of guaranteed tenant improvements. Tenant improvements include costs to make improvements on the property. If you are not aware of this stipulation, then you could wind up gaining more debt without realizing it. You should always look for any hidden fees before you sign the lease. Once you sing the lease, you agree to abide by all terms and fees. Before you sign, you should break down all of the associated costs and fees. This includes the following:

• Rent
• Insurance
• Management
• Common area maintenance

Add up all of your fees before you sign the lease. When you embark on signing a lease, you should also have specific goals in mind. The office space or commercial property has to meet specific business needs. You always want to evaluate how you will fit in the space that you lease.

The other terms you need to pay close attention to are the ancillary terms. These have an impact on how much you will pay every month. For instance, this will cover maintenance costs, unexpected repairs, custodial services and more.

The provided information is for educational purposes only. It is not intended to be legal advice.

Posted in Commercial Leases | No Comments »

Mediation is a form of alternative dispute resolution. It often gets credit for reducing the costs and time investment of litigation. However, you may not always wish to go through mediation to handle your real estate disputes in California. Unfortunately, you may not always have a choice. 

The California Association of Realtors explains that many real estate contracts include a clause that mandates mediation in disputes. This does not mean you cannot ever go to court. It does mean you will have to go through mediation first to try to resolve the issue before you can even think about taking things into a courtroom. 

This may not be what you want to happen. That is why it is important to carefully read over real estate contracts. If you find yourself with a mediation clause and you agree to it, then you are bound by it, which may mean you have to deal with issues through mediation without ever being able to go to court. 

This type of clause is very common in real estate contracts. It is included in the CAR residential purchase agreement as part of the standard language. You may find it in agreements of all types. 

Of course, just because you agreed to mediation, it does not mean you have to come out of mediation with a resolution. If this happens, then you can go to court. Agreeing to mediation does not mean you agree to reach a resolution, and some situations are best going to court instead of resolving in mediation. This information is for education and is not legal advice. 

Posted in Firm News | No Comments »

One of the nice things about the United States is the size of the country means a variety of economic situations. Investors in California are having a nice go currently, which allows them to invest in other areas that can really use the help. This is a great example of Americans helping each other. It also shows how one state’s economy effects another.

Recently commercial real estate investors from California made a huge purchase in Chicago. The downtown area has been suffering from a bit of a downturn in its real estate market. This particular building has been on the market for quite some time. While bids have been coming in, they have not hit the target for the seller until the California group came along.

The offer is lowering than the full asking price, but high enough to be effective in moving the sale along. The skyscraper will soon change ownership, which is a win for everyone who owns big office buildings in the downtown area. Since sales have been lagging, the sale of this building could signal a rebound, which is something everyone can get behind.

Sometimes all it takes is an outsider to come in and change things. That will hopefully be the case for the real estate market in Chicago, and it is all thanks to investors from California who saw potential and made a deal. While this type of deal offers benefits to both the seller and buyer, not every real estate deal is as equal. That is especially true when it involves investment partnerships, which may benefit from consulting an attorney before finalizing deals.

Source: Crain’s Chicago Business

Posted in investment Partnerships | No Comments »

As a small business owner, you have to complete a variety of tasks every single day. If your company is expanding, though, finding the right property is likely high on your priority list. Unless you regularly deal with commercial leases, you may feel a bit out of your element.

Signing a bad commercial lease can ruin your business enterprise. After all, if you default on the lease, your landlord may have a cause of action against your company. While commercial leases come in a variety of styles, there are some red flags that may cause you to reconsider the commitment. Here are three of them.

1. Excessive lengths

As you know, it can be difficult to gauge the future success and growth of any small business. Therefore, you should probably think twice before signing a long-term lease. If your company outgrows the space or you must wrap up business, you may have to continue to pay rent until your landlord finds a new tenant. Generally, commercial leases should be for about two years. The same is true for lease renewals.

2. Triple-net clauses

Sometimes, landlords ask renters to pay taxes, insurance, maintenance fees and rent. Known as triple-net clauses in commercial leases, these provisions almost always benefit the landlord. They can cause your property expenses to rise both considerably and uncontrollably.

3. Undefined fees or penalties

Good commercial leases are specific. If the lease you are thinking about signing has hidden fees, undefined penalties or other costs, you may be in for a big surprise. As such, always look for a commercial lease that spells out every expense your small business must cover.

Like with all contracts, you should read and understand any commercial lease before you sign it. If you notice any of the above red flags, you should think twice before executing your lease. Only when you fully comprehend the consequences of the contract can you make the right decision for your company.

Posted in Commercial Leases | No Comments »

To buy a California home can be an exciting journey. What is not exciting, however, is when those hopes and dreams of a new property turn into nasty legal disputes later on. Fortunately, there are ways that you can protect yourself from facing legal disputes over your real estate investment.

Understandably, to purchase real estate is exciting. It is a dream that many people hope to encounter someday. When you are purchasing a home, do not be too eager. Forbes warns not to skip the inspection. Some buyers forego the inspection to move the process along and wind up paying too much for a home full of problems. Inspections can alert you ahead of time to any issues.

You should also be careful when it comes to placing offers down on a home. Remember that your offer is serious. Even if you hope to negotiate, you do not want to place a bid down that you are not willing to pay. If the seller accepts your offer, you may not be able to get out of it. You are agreeing to enter into a contract.

As a buyer, you have to protect yourself. Buyers should purchase title insurance because it protects them from financial losses due to defects in the title of the property. The insurance company will research the title to find out if there are any debts or liens associated with your title. You do not want to risk a major loss when purchasing a property.

The provided information is for educational purposes only and should not be taken as legal advice.

Posted in Real Estate Litigation | No Comments »

California landlord and tenant relationships can be complicated. Most landlords want to keep the relationship as smooth as possible. The most vulnerable times for a property owner and tenant is the move in and move out times.

If a tenant moves out, you need to make sure that you receive written notice. Forbes states that In California, the tenant has to give a 30-day notice if he or she plans to vacate the premises. If you are renting out a property, then you should never accept verbal notice. Always get everything in writing. This leads no room for misunderstandings.

Communication is important in preserving a property owner and tenant relationship. When your tenant is moving out, you should send a list of expectations and what you expect the tenant to do to keep his or her deposit as much as possible. If you want the tenant to use a specific cleaning company to clean the unit, you can specify it in this notice.

If there are any damages to the unit, then you should make a list of damages. When you have to remove any money from the deposit, it can smooth things over to have a reason. This will also make it more difficult for the tenant to dispute the charges. If you do not tell a tenant why he or she did not receive the full deposit back, he or she may take legal action. In addition to listing damages, if you are going to be returning part of the deposit, then you need to make sure that you return the deposit on time.

Posted in Firm News | No Comments »

If you rent a California residence, then odds are you want to feel secure in your house or apartment. You do not want to have to worry about finding a new place to live at a moment’s notice. The housing market is difficult to navigate when you have a lot of time to find the perfect place. This is worse when you do not have ample time to apartment or house hunt. If you signed a lease, can the property owner terminate it for any reason? The answer is that if you are on a proper lease, he or she cannot.

In order to terminate a lease, the landlord has to navigate legal channels. He or she has to give the tenant written notice. This cannot be an e-mail or any other form of communication. It has to be in writing. The Los Angeles Times explains that when you are on a lease, the property owner cannot give terminate your lease without a reason. He or she has to give you a 60-day notice. In that 60-day notice, he or she has to explain to you why he or she is terminating the lease.

The reasons for terminating a lease generally involve tenants who did not pay rent, tenants who commit illegal acts or those who break the rental agreement. A property owner cannot evict a tenant as a form of discrimination against a protected class. If your landlord terminates your lease, make sure that you have the termination in writing. Then, it is crucial that you hang onto any important documents, like your eviction.

Posted in Firm News | No Comments »

The basic steps to evict a tenant in California remain the same whether that tenant is commercial or residential. As the landlord, it is essential that you follow the right steps or you could face legal issues with getting the tenant removed from the property. Luckily, the steps you must take are pretty straightforward and follow a general timeline.

The California Courts explains the first step you must take is filing a notice that gives the tenant a certain number of days to vacate the property. The amount of time depends on your situation, but you can file this as soon as rent is late according to the lease. You must wait for the tenant to respond to the notice. If there is no response, you will file a complaint with the court and serve the tenant with it.

At this time, you will have to provide the court with proof that you served the tenant. You will then wait the appropriate time for a response.

If the tenant does not leave your property or respond via the court, then you can file a case with the court to evict the tenant. You can ask the court for a default judgment, which simply means you are asking the court to tell the tenant he or she must get out now. You may have to go to a hearing as well to show your evidence against the tenant.

If the judge finds in your favor, you will then be able to get a Writ of Possession, which says you have the legal right to the property. The Sherriff will post a notice the tenant that he or she must get out of the property by a specific date. Upon that date, the sheriff can remove the tenant and you take possession of the property. This information is for education and is not legal advice.

Posted in Firm News | No Comments »

California law heavily favors residential tenants, but when it comes to commercial tenants, few legal protections exist. If you are one of the many renters of commercial space in the Golden State, it is important that you understand what rights you do have so that you can protect yourself should issues with the landlord arise.

According to SFGate, residential tenants in California have the right to a livable space that is free of hazards and that includes working lights, electricity, plumbing and heating. Commercial tenants, on the other hand, have no such rights. Your landlord has no obligation to make repairs unless the lease specifically says he or she will. Even then, he or she does not have to make the repairs promptly, and you cannot hold him or her accountable for any liability associated with your business.

Per California law, residential landlords cannot raise the rent on tenants unless they give tenants a 30- to 60-day advance notice. This is true even with month-to-month rental agreements. Again, commercial tenants do not have that protection. Your landlord can raise the rent on you at any time, unless the lease has stipulations saying otherwise.

Your rights are minimal as a commercial tenant. For this reason, SFGate recommends writing whatever rights you do want into the lease. Go over the lease carefully, and have a knowledgeable third party, such as a lawyer or real-estate advisor, review it. If you want to enjoy certain protections, make sure to write them into the lease, as verbal agreements are difficult to enforce.

This article is not meant to serve as legal advice. It is for educational purposes only.

Posted in Commercial Leases | No Comments »

The disclosure laws in California vary, and to which a property owner must adhere depends on several factors, including the type of property in question and whether the property owner wishes to lease or sell. Moreover, the state treats leases with an option to purchase and ground leases as sales transactions, which further affects disclosure requirements. For yours and other realtors’ convenience, the California Association of Realtors details disclosure requirements for commercial transactions via a chart.

If you own a commercial property built prior to 1979, you must reveal to tenants the contents of an asbestos report. If the building does contain asbestos-containing materials, you must inform tenants of the location of the materials and educate them on how to prevent or minimize release, disturbance or exposure.

As a commercial property owner, you must also state on every lease whether or not a Certified Access Specialist has inspected your property and, if so, whether the property meets all relevant construction-related accessibility standards for the disabled. If there is no CASp report, you must indicate this in the lease. If there is such a report, you must deliver it to the prospective tenant 48 hours in advance of execution of the lease. Otherwise, the tenant has the right to cancel the lease within 72 hours of execution.

When it comes to material facts, you must only disclose a condition if it is “dangerous.” The courts may consider your failure to do so as fraud.

You also have the duty to reveal to future tenants whether past tenants used chemicals known to cause birth defects, cancer or other reproductive harm in the building. If so, you must post a list of the chemicals and the harms they cause for future building occupants to see.

Though not a disclosure requirement, California law requires you to equip your commercial properties with water-conserving plumbing systems prior to leasing them. You must also ensure that your building has enough fire alarms to comply with building and safety codes.

This article is for educational purposes only. It should not be used as legal advice.

Posted in Commercial Leases | No Comments »