5 Clauses That Madison Management Recommends For All Lessors

It often happens that lessees take certain things for granted. A well-constructed and clear rental agreement safeguards not only the lessor’s interests but also the lessees’ interests.

Here are 5 clauses that Madison management recommends for all commercial rental agreements.

Expansion of space clause

The latest set of buyers in New York commercial real estate are start-up organizations. These firms have the potential to expand in short periods of time but they like to start off with a relatively small office space. In all probability such lessees assume that if they want an expansion of space, the landlord will easily grant it to them. Good consultants such as Madison Management ensure your discretion by advising you to include the expansion of space clause. This clause clearly states that the landlord is under no legal obligation to grant an expansion of space unless they wish so. With this clause you can easily refuse the expansion request.

Extension refusal clause

This clause too comes highly recommended by Madison property Management Company. This clause states that the lease period is the only time period that the landlord has to honor, with the condition that there are no financial disagreements or any other disagreements between the said parties. A tenant also takes for granted that as a lessee they are entitled to an extension of their lease. This clause will clearly state that an extension may be denied without any explanation. It also goes onto state that an extension may only be gained if a written notice is addressed to the landlord eighteen months prior to the stipulated lease period.

Late payment clause

This clause elucidates the importance of making rent payments on time. It also clearly states that the lessee will get a written notice on default of payment. It further goes onto explain that a stipulated number of missed payments will automatically lead to a termination that will come with a brief notice period. Even though most property management services including residential advisors will advise this, but Madison property Management Company stresses on this clause. If this clause is clearly mentioned in the agreement, the chances of dispute later are reduced.

Security deposit reduction clause

Tenants often insist that the security deposit be reduced from four month’s base rent to three month’s base rent. This clause may seem like something that will cause a loss to you, but it comes with a condition that is advantageous to the lessor. The clause clearly reads that the security deposit will be reduced only if the lessee fulfills certain conditions. The conditions may be decided by the lessor and often include maintenance requirements such a paint job, light fixtures, etc.

Landlord consent clause

This clause too is often lost in translation, therefore it is advisable to clearly state all the activities that the lessee can conduct only after gaining the lessor’s consent in the agreement. These activities should be listed under the landlord consent clause.