Commercial Lease Exit Clause for Landlord
UPDATED POST see below 

Hello— My office lease is up for renewal and I’ve just been informed that the landlord wants to include an exit clause where they tell me my lease will not be renewed in xx months. How do I negotiate this?

I am an excellent tenant, always pay on time. I’ve been in the space about four years and put in considerable investment into reengineering and refurbishing the space to meet my needs. The current landlord bought the building less than two years ago.

Is this a sign that I could be thrown out of the building? The LL says no.  It is a “just in case” clause. 

I told them preliminarily that I would require at least a year’s notice. I am told that I could ask for them to pay me a certain number of months rent as a consolation for being moved out.

What is reasonable to ask in this situation? I had planned to stay in the space another ten years until retirement. Now I’m wondering if I should look at alternatives.

Thanks for your help.
[{"id": "fm13dk3", "text": "LLs do this for a couple reasons. First, to provide flexibility if a large tenant comes along and needs your space to string together a contiguous space. Second, if a, owner-user wants to buy the building for their own use. A LL I used to work for did this in his leases and I think once ever I saw him exercise the clause. \n\nYou can try to get the LL to pay X amount as a termination penalty for moving costs/loss of business/etc. Do some research on market rent, moving costs, what a loss of a month of business looks like, and so on. I would certainly ask for more than just a notice period and throw the \"just in case\" back at them. Also, good for you for actually reading your lease. Like 1 in 100 tenants ever bother.", "replies": [{"id": "fm14ufu", "text": "Thanks for your response. What exactly does \u201cthrow the \u2018just in case\u2019 back at them\u201d mean? Can I ask for a year\u2019s rent for moving costs/cost of doing business? The last time I looked for an office it took me a full year to find a suitable one. The market has changed a lot since and has been flooded with freshly built offices. I\u2019m currently paying $35/ sq foot which is high given that it is a less than desirable office (basement office, situated just next to the bathrooms; adjacent to the driveway for the building so that every car that passes makes a noise and sprays rain, etc.). The office is below ground and essentially basement level. Plus with coronavirus I\u2019m not sure people will be rushing into business. The building currently has several vacancies that are under construction.\n\nThank you SO MUCH for your input!", "replies": [{"id": "fm18j1r", "text": "Piggybacking here...You mentioned you spent a lot of $ into customizing the space. You should quantify that and in your counteroffer you should propose they pay for some % of that cost as a buyout. Maybe half? Assuming you can live with the kickout clause at all, I would go back with: 12 months written notice required, the last 6 months of occupancy will be rent free and LL shall pay 50% of the costs tenant has contributed to the space during its occupancy as a lease termination fee (and provide a breakdown of those costs).", "replies": [{"id": "fonyegd", "text": "I ended up doing almost exactly what you suggested and the landlord went for it! See my update above.", "replies": [{"id": "foor8f2", "text": "Hey, great! Glad it helped you.", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}, {"id": "fm1ivhy", "text": "I meant if the LL wants the clause from you \"just in case\" then you need the financial and time protection for the same reason. I would be surprised if you got a year of rent plus plus plus out of it.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fm21xk3", "text": "Excellent advice! Thank you so much!", "replies": [], "depth": 1}, {"id": "fm486pw", "text": "Thank you so much everyone for your help! This advice was exactly what I needed.", "replies": [], "depth": 1}, {"id": "fo5q3gk", "text": "UPDATED 4/21/20:\n\nJust an update: I asked for a year's notice plus other considerations: \n\n\"In the event of early termination of this lease, the landlord shall give written notice twelve months in advance, plus six months of rent costs. In addition the landlord will pay 50% of the costs that the tenant has contributed to the space during occupancy. The latter two conditions represent a lease termination fee. I'd be happy to provide receipts of the improvement contributions. (I'd have to go through my records but I'd estimate this would amount to 50% of approximately $3000, including rugs, sound proofing materials, paint, ceiling fan, etc.)\"\n\nIt took a couple of weeks but the landlord came back in agreement with all my terms! However, the representative came back with the following: \"The 'LL is not currently increasing rents on tenants, considering the circumstances created by the virus. [How nice of him!] Therefore you may pay your current rent for May and June and we will draft a new lease  beginning on July 1. In the meantime, if you would sign a formal proposal of new lease terms it would be great to have a commitment from and for both parties.\"\n\nThis threw me. I am a psychologist and have transitioned some of patients to telemedicine.  Some have not agreed to this transition so I'm afraid I've lost them. I am struggling financially and am considering moving my practice to my home. It is.not ideal.but it sure beats paying $1000+a month for an office I cannot use. I went there the other day to pick up my printer. The place was deserted. I am very fearful of second wave of the virus starting up in the fall and demanding another period of confinement (and telemedicine again.) Here is how I responded: \n\n \"I honestly don't know what to say regarding a formal commitment at the moment. I have every  intention to renew my lease in July. However, I'm really taking a hit from covid-19 and I don't know how long I can sustain my practice given the current circumstances. There is a lot of money going out in rent and a much reduced amount coming in. Let's see how the next months go. I can commit to paying through June but I think we'll both have more information as time.goes by. Please thank [the landlord] for agreeing to the terms.of my.exit clause. \"\n\nI received no response. I continue to pay my rent early every month. I am thinking about renegotiating my rent for July at a reduced rate given the circumstances. Is this feasible?  What is happening in the current market? Can I agree to pay 50% of my rent for the next year and then renegotiate the terms.of my lease in a year?  I can move my practice to my home but it will require some retrofitting. I really don't want to but I will if I have to.\n\nYour thoughts? Thank you again so much for your advice and feedback. It has been invaluable!", "replies": [], "depth": 1}]