Disputes. They’re everywhere. And even some well-known landlords and tenants can’t agree. In lovely and scenic Santa Clara, Calif., the San Francisco 49ers filed for arbitration with the city Tuesday after failing to negotiate lower rent for Levi’s Stadium.
According to the San Jose Mercury News “the NFL team had been in negotiations with the city since November to lower rent for the remainder of a 40-year lease at Levi’s Stadium, which opened in 2014. The team argues it is entitled under its lease contract to a reduction of more than $4 million a year because of better-than-expected financial performance.”
Apparently, the Niners in 2013 agreed to pay $24.5 million for the first year, but its contract provides a one-time “rent reset” after the first year of operations — adjusting the rent based on changes in revenue, updated development costs and expenses. Ahhh, the old “rent reset” Gets ‘em every time.
It’s unclear how long the arbitration will last, but it’s estimated to cost six-figures on both sides. The losing party usually pays the other side’s legal fees, but the arbitrator could also decide to split fees among the parties.
So you may not own a giant football stadium, but you may see some landlord/tenant disputes that affect your business. When you do, call in Dean Sperling Law to resolve those disputes quickly and efficiently with your best interests in mind.
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