Creating certainty in the inherent uncertainty of the future is the name of the game when it comes to drafting commercial leases. When courts overrule provisions that the parties to the lease have agreed upon, however, that supposed certainty goes out the window. This fact pattern played out recently in Epochal Enterprises, Inc. v. LF Encinitas Properties, LLC (4th Dist., Case No. D079905) (“Epochal”), when the California Court of Appeal ruled that a limitation of liability clause in a lease that purported to release the landlord from liability for failing to disclose asbestos was against public policy and not enforceable.Continue Reading New Court Ruling Pokes Holes in Contractual Limitation of Liability Language in Commercial Leases

New York City’s rent-related laws have once again survived judicial scrutiny, and evaded Supreme Court review. In 74 Pinehurst LLC v. New York, a group of New York City landlords (“Petitioners”) filed suit in the District Court for the Eastern District of New York against the City and State of New York, the State Division of Housing and Community Renewal, New York City’s Rent Guidelines Board, and multiple state and New York City officials (“Respondents”), seeking a declaration that New York City’s Rent Stabilization Law, as amended in 2019 (“RSL”), violates the Fifth and Fourteenth Amendments of the United States Constitution. Respondents moved to dismiss, which the Eastern District Court granted. On appeal, the Court of Appeals for the Second Circuit affirmed the motion to dismiss, and on February 20, 2024, the Supreme Court denied Petitioners’ petition for certiorari, declining to review the RSL.Continue Reading SCOTUS Declines to Review New York City’s Rent Stabilization Law

The California State Legislature is considering Assembly Bill (AB) 2216, a measure introduced by Assemblymember Matt Haney, that would force landlords to permit pets in residential rental properties. Specifically, the proposed legislation restricts a landlord from barring a tenant from owning or keeping a common household pet without valid justification. The bill also prevents landlords from charging tenants extra rent or security deposits for owning or keeping a common household pet. However, these restrictions do not apply to rental agreements signed before January 1, 2025.Continue Reading Unleashing AB 2216: Will Fido Have a Leg Up on Landlords?

Brooke Miller and Shannon Mandich’s article “Adapting Underutilized Commercial Spaces for Residential Redevelopment: New Tools and Challenges” was recently featured in the NAIOP Commercial Real Estate Development Magazine Spring 2024 Issue. The article discusses the tools and challenges of adopting underutilized commercial spaces for residential redevelopment. This article sheds light on the pros and cons of adaptive reuse and California’s support of adaptive reuse through various California state laws such as Senate Bill 6, the Middle Class Housing Act of 2022, Assembly Bill 2011, and the Affordable Housing and High Road Jobs Act of 2022.Continue Reading Adapting Underutilized Commercial Spaces for Residential Redevelopment: New Tools and Challenges

Pamela Westhoff and Meigan Everett’s article “A Landlord’s Guide to Assistive Animals” was recently featured in the Daily Journal. The article broaches the topic of pets in the workplace, including: the difference between service animals and emotional support animals (in the context of commercial tenants and landlords); legal definitions of the two categories of assistive animals; related contractual, verification, and disclosure issues to consider; leasing industry guidance on this topic; and additional tips on preventing or resolving disputes.Continue Reading A Landlord’s Guide to Assistive Animals

It is well known that between New York’s enactment of the Marihuana Regulation & Taxation Act (commonly known as the Cannabis Law) on March 31, 2021 and the slower than anticipated adoption of regulations for adult-use cannabis retailers and implementation of the Act there have been few (and in some geographic areas of the state, no) licensed retail dispensaries opened for the sale of adult-use of cannabis and cannabis related products. As a result, there has been a proliferation of unlicensed retailers (often referred to as “sticker shops” because the sale of stickers comes with the “gift” of cannabis products) selling cannabis products and its derivatives. On May 3, 2023, however, with the conclusion of New York State’s annual budget process and the signing of the state budget bill by Governor Hochul, a series of other bills passed by the state Assembly and state Senate were signed into law by the Governor. Among those additional measures are changes to New York’s Cannabis Law[1] which are intended to curtail, among other activities, the unlicensed sale, distribution and storage of cannabis and cannabis products throughout the state. Continue Reading New York Landlords May Get Stuck with the Bill for Unlicensed Cannabis Sticker Shops

Sinatra may have found success in the city that never sleeps, but a California court has just made it more difficult for any party doing business with a California resident to do the same. At least, when it comes to resolving disputes without a jury in a New York courtroom, or in the courtroom of any other jurisdiction that enforces pre-dispute jury trial waivers. This case will be of major interest to commercial lenders, and other businesses, who prefer to use New York as their jurisdiction of choice for governing law and adjudicating disputes.
Continue Reading Start Spreadin’ the News: California Court Says No to New York, New York; Rejects Forum Selection Clause

California has positioned itself as a leader on emerging cannabis policy. While federal law still prohibits cannabis-related activities within the State’s borders, several largely progressive laws in California permit the possession, cultivation, transportation, and distribution of cannabis. The effects of the burgeoning cannabis industry are far-reaching, and have already proven to significantly impact the real estate industry. This Article addresses the history of cannabis regulation within California, the legality of various land use approaches employed by jurisdictions throughout the state and some of the nuances a property owner should consider when negotiating a commercial lease with a tenant who intends to use the premises for a cannabis-related use.
Continue Reading Cannabis Regulation is the New Frontier in Real Estate and Land Use Control

Under current California law, commercial real property owners are required to state in every lease agreement whether the property leased has undergone inspection by a Certified Access Specialist (“CASp”) and, if so, whether the property has or has not been determined to meet all applicable construction-related accessibility standards. [California Civil Code Section 1938].  Effective immediately, additional commercial lease accessibility disclosures are required.
Continue Reading Commercial Lease Alert: New Access Law Disclosure Requirements In Leases Effective January 1, 2017