What is condemnation in a lease?
Typically, a condemnation clause permits a landlord or a tenant to either terminate the lease or abate the rent in the event of a government “taking” of the leased property. Courts ordinarily require a showing that the affected tenant is basically shut down.
What does a condemnation clause address in a commercial lease?
A condemnation clause provision that would allow the tenant to recover just and adequate compensation for items that would not reduce the landlord’s recovery often are included in the lease. These items would include business damage, fixtures and personal property of the tenant and relocation benefits.
Why is condemnation important?
The key to a condemnation clause is providing for appropriate remedies. Condemnation lease clauses may provide for leasehold termination, leasehold extension options, restoration obligations, apportionment, bonus value, abatement of rent, and may address relocation rights.
What is inverse condemnation in real estate?
Inverse condemnation is a legal concept that entitles property owners to just compensation if their property is damaged by a public use. This liability rule applies to all government agencies, as well as utilities.
Is a lease terminated by eminent domain?
Generally, if the leased premises are taken by government power or eminent domain, the lease will be terminated as of the date of taking (unless the lease specifically provides otherwise), and the tenant’s obligation to pay rent would cease.
What does it mean when a business is condemned?
The legal definition of condemnation is the seizure of private property for public use. Condemnation occurs when a local, state, or federal body uses government authority to seize private land and compensates the owner.
What is the process of condemnation?
Condemnation is the legal process utilized by the government to order that a property be vacated. Condemnation is often used in the eminent domain process to acquire property for public use such as highways, railways, airports, powerlines, and pipelines.
What is an example of inverse condemnation?
Example: the city of Los Angeles widens a boulevard and thereby takes the entire parking lot of Bennison’s Busy Bee Market. The city offers to pay for the lot, but Bennison claims the market has lost all its business since no one can park and wants the value of the entire parcel, including the market building.
What does condemnation mean in legal terms?
Condemnation is when a government orders that a piece of property be vacated and kept vacant, due to some public purpose or concern. The two most common are due to the unsafe condition of the property or to carry out a government taking of the property under the legal doctrine of eminent domain.
What does a condemnation clause in a lease mean?
A condemnation clause in a lease provides for the contingency that the leased premises or a part of the leased premises may be taken for a public purpose by an entity with the power of eminent domain before the lease has expired. So that it is not confused with the contingency that the property will be “condemned” for
What is the definition of condemnation in law?
Condemnation is the seizure of private property by a government for a public purpose. Eminent domain gives governments the power to take private property. However, the government must compensate…
What happens to a lease when a building is condemned?
Does a Lease Terminate When a Building Is Condemned? Complete condemnation terminates a lease because there is no housing left for a tenant to live in. Condemnation ends the tenant’s liability for rent accruing after title vests in the condemnor, which is usually the local government or housing authority.
How is condemnation used in the real estate industry?
Condemnation is the legal process utilized by the government to order that a property be vacated. Condemnation may be used to enforce housing and safety codes or as part of a process to seize a property from the owners.
