Don’t miss out—your Renewal Option matters
A renewal option is a valuable component to have in any lease! Typically, standard lease language requires that a tenant give notice of its intention to exercise this option by a set deadline. But some tenants don’t realize the importance of meeting this deadline, and the possible consequences of missing it.
Late notice could cost you your renewal option.
Although some states require an owner to honor a late renewal notice that meets certain criteria, those states are in the minority. In fact, most state courts are likely to rule that if a tenant serves its renewal notice late, the owner need not renew the lease. As a lease administrator, it is your responsibility to keep track of lease deadlines and make sure you serve your renewal notice on time. How do you protect yourself from inadvertently missing critical deadlines? Require the owner to send you a reminder notice saying that the renewal notice deadline has passed—giving you a second shot at exercising your renewal option.
We can help explain the minority and majority state views on late renewal notices. In addition, we can give you model language, that you can personalize to your unique situation, and adapt and to require the owner to give you a reminder notice.
- You CAN avoid losing your renewal option!
- Be proactive
- You have bargaining strength
Whether you can convince an owner to give you a reminder notice if you miss the lease renewal notice will depend on your bargaining strength as well as other factors. For example, large national retail tenants are likely to get an owner to agree to give them a reminder notice, but such a requirement is far less common in office leases. Compliance within all facets of real estate lease management is essential.
Needless to say, staying up-to-date regarding the latest changes in lease administration, and remaining dedicated to proven best practices of ongoing education, is a must.
NRTA is proudly collaborating with two seasoned professionals—Lisa Krizek and Kathy Powers-Middlecoop—to present a four-part lease management course. This comprehensive course provides the lease administration student with an in-depth understanding of lease administration, and the role of the Lease Administrator.
The session covers all aspects of lease administration, from the receipt of a new lease, through expirations and renewals, to property turnover. Participants will gain a thorough understanding of how lease administration plays a key role in the success of an organization in today’s world.