In negotiating an office lease, business owners should pay particularly close attention to the provisions detailing the services that the landlord will be required to provide and the terms and conditions regarding those services. Business owners often have significant negotiating power with respect to such provisions, and therefore have the potential to custom-fit the services that the landlord will be required to provide to the specific needs of their business.
Landlord services that business owners should consider include:
- Heating and air conditioning. Will the landlord or will the tenant decide the temperature at which the premises will be maintained? If the landlord will decide this matter, does the office lease detail the minimum and maximum temperatures at which the premises will be maintained?
- Electrical requirements. Does the office lease state that there will be sufficient electrical supply for purposes of operating your business? For example, if you are planning to maintain high-electricity appliances or equipment in your office space, will the electrical configurations of the premises support such electrical requirements? Will the landlord charge an additional electricity fee if your electricity use is above a certain level of use?
- Cleaning services, including exterior window cleaning services. Does the office lease state how often cleaning services will be provided and what will be covered by such cleaning services?
- Adequate lighting and water. Does the office lease state that the landlord will provide adequate lighting and water for purposes of operating your business?
Beyond the actual services to be provided by the landlord, business owners should be sure to also consider the following matters with respect to the landlord’s services:
- The days during which the landlord will not be required to provide services. For example, will the landlord be exempt from providing services on weekends and holidays? Are there any days on which the landlord will be exempt from providing services, but the business will be operating within the premises?
- The hours of the day during which the landlord will not be required to provide services. For example, will the landlord only be required to provide the services from 8:00 a.m. to 6:00 p.m. or on a 24-hour basis? Are there hours during which the landlord will be exempt from providing services, but during which the business will be operating within the premises?
- If a force majeure event prevents the landlord from providing services, will the tenant be entitled to a rent abatement?
- Is there a process for the tenant to request services beyond those that the landlord is required to provide? For example, if the landlord is not required to heat the premises on weekends, and there is one weekend on which the tenant would like the landlord to do so, can the tenant require the landlord to do so? If so, how will the cost for such additional services be determined? Ideally, the office lease will provide that cost to be paid by the tenant for such additional services will be limited to the actual cost incurred by the landlord.
In negotiating an office lease, business owners should carefully review and negotiate the provisions related to services that the landlord will be required to provide and the terms and conditions regarding those services. Successfully negotiating such terms is often an important prerequisite to achieving satisfaction with the office space.
About the Author: Josh Humi, an associate with PilieroMazza, practices in the Business and Corporate Law Group. – He may be reached at jhumi@pilieromazza.com.