REDEVELOPMENT OF EXISTING SITES AND BUILDINGS MARK ELLIOT & DAVID KIRK
For the building densification, the following issues may arise with the
leases:
(i) Constructive Eviction. This may be the least likely impact
(because it is a difficult remedy for a tenant to invoke; the standard is a
high one to meet), but is the one that, if invoked, would cause the most
dramatic impact. A tenant constructively evicted may terminate the
lease. The standard of constructive eviction under law is reached
generally when the premises have deteriorated to the point where they
are unfit to continue to inhabit. While generally constructive eviction is
found through an owner’s lack of repair, it can exist where the
premises are allowed to deteriorate. Whether substantial construction
noise and debris outside the norm of normal office occupancy could
trigger a tenant’s claim of constructive eviction is an open question.
If the desired densification is of
an existing building (where an (ii) Rights to Alter the Common Area. The roof or exterior plaza
owner is adding levels to the areas may be common areas to the tenants of a building. Many leases
building or taking unusable will by their terms limit a landlord’s right to change or alter common
space and making it usable), areas to the detriment of the tenant, or in a material manner, and the
there is one set of lease issues. law will impose limits as well, to the extent that the benefit of tenants’
We “building bargain is not provided. Also, tenants may have rights to place
densification”. If the desired communications equipment on the roof, which would be adversely
densification is taking an existing impacted if there is a rooftop addition such as the addition of a
large, underdeveloped tract of penthouse level on a building.
call
this
land (such as a multibuilding
office park with several lowrise
buildings) and making it more
developed and denser by adding
buildings on undeveloped land,
or tearing down buildings and
replacing them with buildings
containing more rentable square
feet, then another set of lease
issues present themselves. We
will
call
this
densification.”
“office
park