However, the terms are not interchangeable. Confusing an extension with an extension – and vice versa – confuses the purpose of a landlord or tenant, the legal rights and the paperwork involved. The tenant`s accidental failure to exercise the lease extension option can be disastrous for the tenant who plans to remain in occupancy after the initial term of the lease expires. I have the option to extend my lease by 5 years. Although I am not in default and have announced that I want to extend the lease, my landlord says he no longer wants to rent the property and will not renew it, although I have invested a lot of money in renovations in the building. Do I have a case to force him to comply with the lease? John could also say he wants to stay, but he could ask to revise a few terms. The landlord may or may not accept these new conditions. When new terms are agreed, a new lease is signed or the old one is updated and initialled. When negotiating your lease, it`s hard to predict what business and market conditions will look like in 5 or 10 years.
If you don`t have an extension option in your lease or it`s poorly structured, it can be very expensive. However, a well-structured renewal option can save you a lot of money, especially in a tight market. as long as no delay has occurred under this Agreement and it continues. If the tenant does not give this notice at the end of an initial renewal period or a subsequent renewal period of the 2017 lease, that initial renewal period or the subsequent renewal period of the 2017 lease (as the case may be) will automatically renew from month to month at the monthly rental price corresponding to the final payment of the tenancy immediately before the end of that initial renewal period or The subsequent 2017 renewal period and this monthly renewal period (the “2017 Monthly Lease Renewal Period”) may be terminated by the tenant or landlord by giving the other party at least ninety (90) days` written notice (the “2017-2017 Monthly Lease Extension Notice Period”). If such notice of the 2017 renewal period has been given by either party, such notice of the 2017 renewal period, the lessee is deemed to have chosen the 2017 lease return option at the end of the 2017 monthly lease renewal period. If the equipment leased under this 2017 Lease Agreement is not in good condition, in good condition and in good working order, is exempt from normal wear and tear or has not been maintained in accordance with section 6 of this Agreement, the Renter will immediately reimburse the Landlord for all reasonable costs incurred in returning such equipment to that condition. In a surprisingly high number of commercial leases, the lease offers the tenant the opportunity to renew, but does not mention what notice the tenant must give the landlord of their intention to renew. California courts have ruled that if the renewal option does not require a specific form of notice, the tenant`s actions or conduct will determine whether the option has been validly exercised or not. In a California Court of Appeals case involving a commercial lease for a food market, the renewal option did not include termination obligations, but an increase in the amount of rent for the extension period. If the renewal option is not clear on the face, the court will review the evidence outside the lease to determine whether the option has been exercised.
In this case, the tenant remained in possession of the premises after the original term of the lease expired and paid the rent increase, which the court found to be sufficient conduct to exercise the option (Cicinelli v. Iwasaki [1959] 170 Cal. App. 2d 58). Exercising the option to extend/extend the lease form provides the tenant with the necessary documents to exercise the option. Alternatively, renewal options can be extremely beneficial for tenants, giving them the peace of mind and peace of mind that they won`t have to move their business every three to five years. .