What to do if my landlord is not honoring my option to renew my commercial lease?
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What to do if my landlord is not honoring my option to renew my commercial lease?
New owners of the property have sent me a letter stating that they do not intend to renew our lease agreement, which ends in a year. However, as stated on the lease agreement, I have a 5 year option to renew at fair market value and I have 6 months prior to the end of the lease to give the landlord written notice of my intention to renew. What should I do at this point?
Asked on November 19, 2016 under Real Estate Law, California
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 7 years ago | Contributor
A lease is a contract and is enforceable in court. If you can't work it out voluntarily with your landlord, you could sue them and seek either a court order requiring them to comply with the lease and let you renew ("specific performance" of the lease/contract) or monetary compensation--e.g. the value of improvements, cost to relocate business, etc.
Note that the new owners *are* bound by the lease. The old owners could only sell what they had, which was a property with a tenant and an unexpired lease. The new owners bought the property subject to the lease.
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