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Can You Break a Lease When Your Business is Struggling?

On Behalf of | Jul 29, 2021 | Real Estate

Finding the right commercial space to lease out may feel exceedingly difficult. When you finally do locate it, you may quickly sign a multi-year lease just so that you can get started. 

But what if a space turns out to be less perfect than you assumed? You know that your business should be working, but it’s struggling because you’re just in the wrong place. Maybe you don’t get the foot traffic that you need, for instance, or your potential customers look for goods and services like yours in another location. 

What is clear to you is that you need to move the company to a new location or it’s going to go under. Can you break that lease on the grounds that you’re just not earning enough for it to be viable? 

Does your lease have a break clause?

This example illustrates why it’s so important to read the lease carefully before you sign. You need to know if it has the proper break clause

Many break clauses have to do with the landlord failing in some fashion. For instance, if they fail to maintain the space so that it is safe and functional, you may be able to lease the space without penalty. But you can also ask for break clauses for a variety of reasons, including poor sales that may make it impossible to make those lease payments in the first place. 

What can you do when your commercial lease has you trapped?

If you do have this type of break clause, you must know how to use it properly. If you don’t have a break clause and you still want to get out of the lease, then you need to learn what other legal options you may have. 

Notice: We are providing this as general information only, and it should not be considered legal advice, which depends on the facts of each specific situation. Receipt of this content does not establish an attorney-client relationship.