DISPUTE RESOLUTION

McKenna, McCausland & Murphy, P.A. has resolved hundreds of lease disputes without the need for litigation, by working with the landlord to fashion relief appropriate for the circumstances. When a tenant is paying below-market rent under its lease, or when a landlord is flooded with telephone calls from brokers and prospective tenants expressing interest in the property, deciding to evict is an easy choice. Where a tenant is struggling with little hope of recovery, we frequently secure agreed upon stipulations for possession, preserving the landlord’s right to pursue rents at a later time. Under different circumstances, the landlord may not wish to evict (e.g., the defaulted tenant is the shopping center’s signature anchor tenant). Leaving a noticeable dark space in a center after an eviction can trigger co-tenancy clauses in other tenants’ leases that might relieve them of having to open, pay full rent, or continue to operate. Vacant storefronts in a shopping center, particularly large ones, are also visually unattractive to shoppers, can decrease foot traffic, and deter prospective tenants. Under these circumstances, it is not entirely uncommon for landlords to reduce rent, or relax anti-assignment or anti-subletting provisions within a lease for struggling tenants. This may be the landlord’s elected option when other stores in the shopping center are already vacant, or if the lease calls for above-market rent. Such measures can buy the landlord time to locate a new tenant, or help keep an attractive store operating during a temporary time of hardship. Oftentimes, the landlord will insist upon kick-out clauses that (in exchange for temporarily reduced rent) allow the landlord to retake possession of the space upon some specified written notice. Landlords with a common national retail tenant across several properties also may not want to evict in order to salvage that relationship across all of its centers. In these circumstances, a landlord might afford rent relief, restructure the lease terms, or secure additional credit enhancements and personal/corporate guarantees. In some instances, it may make sense for the landlord to keep the tenant at the property (as opposed to suing for possession), and pursue a collections action for unpaid rent from the tenant and/or any guarantors. When it comes to resolving disputes without litigation, successful landlords call us.

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