Alternatives to eviction for non-paying tenants of office space

Nina L. Kaufman, Esq.

Nina L. Kaufman, Esq.

An award-winning small business attorney in New York City, Nina is a sought-after professional speaker and Entrepreneur Magazine online contributor. She is the go-to counsel for knowledge economy and creative companies, delivering legal services and educational resources that save them time, money, and aggravation.

Posted on May 5, 2015 in Business Transactions

Q.:  I have a commercial lease tenant who is no longer paying.  The agent who manages my property (in Mexicali) does not sound positive about finding a new tenant anytime soon for the office space. I worry that if I evict my tenant, the property will be empty for a long period. Are there any alternatives to eviction?

 

A.:  So let me get this straight: you would rather have a commercial tenant in the office space who’s not paying rent, than evict the tenant and leave the office space open? Either way, if you’re not getting paid you’re not getting paid. Why should the tenant get the benefit of staying in your office space rent free?

There aren’t a lot of promising alternatives to eviction on commercial leases. You could try to renegotiate the rent to see whether the tenant can pay at least something for the office space. And if that amount is enough for you to cover your costs for the office space (even if it’s not as much as you would have wanted), at least you’re not losing money on the deal. You could give the tenant an ultimatum about taking on a subtenant or finding another company to take over the space before you bring eviction proceedings. But keeping the tenant in the office space, because you “wish and hope” that they may be able to pay someday, is not a sound business strategy.

If your commercial lease agreement is silent about your rights upon default, you have to look to Mexican/Mexicali law to determine your options. You’ll want to speak to a local lawyer about that.

 

What other law questions do you have about commercial leases and office space?

 

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