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5 Bottom-Line Issues to Consider when Negotiating a Lease Guaranty
Landlords often require a personal or corporate lease guaranty. A commercial real estate lease guaranty, a separate document executed simultaneously with the lease, makes the guarantor liable for the tenant’s defaults under the lease. The conflicting interests between landlord and guarantor are obvious: landlords want an unconditional and unlimited guaranty, while guarantors want a conditional and limited guaranty. Below are five bottom-line issues to consider and a checklist to review when negotiating a commercial real estate lease guaranty.
Set a maximum dollar cap on guarantor’s liability. The parties can set a maximum dollar cap on the guarantor’s liability. For example, the landlord can agree to cap the guarantor’s liability at $100,000, $500,000, or any other amount. The dollar amount of the cap generally bears some relationship to...[read more]
Angel Law Offices - Commercial Real Estate Lawyers - Los Angeles | Denver | Boulder
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