Here is a breakdown of the most important provisions to focus on before you sign.

1. Franchisor Lease Rider Requirements

Most franchisors require a lease rider or addendum that gives them specific rights in the real estate. These terms are typically non-negotiable and must be reconciled with the landlord’s standard form lease.

Key provisions usually include the franchisor’s right to receive default notices directly, the right to cure tenant defaults to keep the store open, step-in rights if the franchisee fails, and approval rights over any alterations, signage, or design changes.

Understanding what your franchisor requires before you negotiate with the landlord will save you significant time and legal costs.

2. Use Clause and Brand Standards

Your lease must permit you to operate the franchised concept exactly as required by the franchisor. A use clause that is too narrow — or too broad — can create compliance issues down the road.

Pay attention to whether the permitted use in the lease matches the franchise system’s requirements, whether exclusive use protections are available, and whether the lease allows for the build-out, signage, and equipment layout your franchisor requires.

3. Rent Structure and Operating Expenses

CAM charges (Common Area Maintenance), taxes, and insurance pass-throughs can significantly impact your unit economics. Many franchisees focus only on base rent and overlook these costs — sometimes with serious financial consequences.

Key issues to negotiate include the definition and exclusions of CAM charges, caps on controllable CAM increases, audit rights, and how your proportionate share of expenses is calculated.

4. Landlord Work, Tenant Work, and Delivery Conditions

Franchise build-outs are expensive and time-sensitive. Your lease should clearly define what condition the landlord must deliver the space in, with specific timelines and remedies if there are delays.

Make sure the work letter coordinates with your franchisor’s design requirements, and negotiate for early access rights so you can begin fixturing and training before the official rent commencement date.

5. Personal Guaranty and Security Requirements

Franchisees are frequently required to provide personal guaranties, letters of credit, or security deposits. Before agreeing to these terms, evaluate whether burn-off provisions are available (where the guaranty reduces over time), whether there are caps on your personal liability, and whether the guaranty terms align with what the franchisor requires.

6. Assignment and Transfer Rights

Your ability to sell the business depends on your ability to transfer the lease. If the landlord can unreasonably block an assignment, it can seriously limit your exit options and the value of your franchise.

Ensure the lease permits assignment in connection with a sale of the franchised business, that landlord consent cannot be unreasonably withheld, and ideally that you are released from personal liability upon a completed assignment.

7. Default, Remedies, and Cure Rights

A lease default can trigger termination of both the lease and your franchise agreement — a catastrophic outcome for any franchisee. Protecting yourself requires extended cure periods, clear notice requirements, and franchisor cure rights that allow the brand to step in before the lease is terminated.

8. Term, Renewal Options, and Relocation Rights

Your lease term must be long enough to satisfy your franchisor’s requirements and to justify the cost of the build-out. Negotiate for multiple renewal options at fair market rent and limit the landlord’s ability to relocate you within the property without adequate compensation.

9. Operating Requirements and Continuous Operation Clauses

Franchisors require continuous operation. Landlords often do too. Make sure your lease includes reasonable flexibility for remodels, temporary closures, and force majeure events — and that dark store penalties are limited or eliminated.

10. Insurance, Indemnity, and Risk Allocation

Your lease insurance requirements must align with your franchisor’s insurance requirements and your actual coverage. Avoid broad indemnities that shift excessive risk onto you, and ensure waivers of subrogation are reciprocal.

11. Coordination With the Franchise Agreement

Perhaps the most overlooked issue in franchise leasing: the lease and the franchise agreement must not conflict with each other. Misaligned terms, renewal periods, assignment mechanics, or default triggers can create serious legal and operational problems.

An experienced attorney will review both documents together — not in isolation — to ensure they work in your favor.

Get Legal Help Before You Sign

Franchise lease agreements are among the most complex commercial real estate documents a business owner will encounter. The stakes are high — your personal assets, your investment, and your franchise license can all be affected by the terms you agree to.

Brent Levison has extensive experience in franchise and commercial law. If you are negotiating a franchise lease or need a review before signing, contact us today for a consultation.

The information in this article is provided for general informational purposes only and does not constitute legal advice. For advice specific to your situation, please consult a qualified attorney.

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In a field where predictability, efficiency, and strategic clarity matter, flat fees create a cleaner, more professional framework for legal services.

No Surprises, No Anxiety

Clients appreciate knowing the cost upfront. There are no surprises, no anxiety about running clocks, and no hesitation to pick up the phone for fear that a six-minute increment will appear on the next invoice.

This transparency builds trust — and trust is the foundation of any long-term advisory relationship.

Expertise Is Rewarded, Not Penalized

For attorneys, flat-fee billing rewards expertise rather than time spent. A seasoned commercial leasing attorney may complete a task in a fraction of the time it would take a generalist — yet hourly billing perversely penalizes that efficiency.

Flat fees flip the model. Mastery and experience become assets, not liabilities. Attorneys can focus on delivering high-quality work, strategic guidance, and thoughtful negotiation rather than tracking time entries or justifying hours. This reduces administrative burden, minimizes billing disputes, and allows lawyers to operate more like business partners than service vendors.

Better Communication, Better Outcomes

Flat-fee structures encourage better communication. When clients know a call or email won’t trigger additional charges, they engage earlier and more openly. That leads to fewer misunderstandings, better-informed decisions, and a smoother transaction process.

In commercial leasing — where timing, leverage, and clarity of terms can materially affect outcomes — this open dialogue is invaluable. Attorneys gain a more complete picture of the client’s goals, risk tolerance, and operational needs, enabling more tailored and effective representation.

Operational Stability for Everyone

From a business perspective, flat-fee billing creates operational stability. Attorneys can forecast revenue more accurately, streamline workflows, and design repeatable processes that improve quality and consistency.

Clients benefit because it produces faster turnaround times, clearer deliverables, and a more predictable experience. The model also reduces friction at the end of a matter — instead of debating time entries, both sides can focus on closing the deal and planning next steps.

A Modern, Client-Centric Approach

Flat-fee billing reflects a modern approach to legal services. It respects the client’s need for budget certainty and the attorney’s need to be compensated for expertise rather than hours.

In commercial leasing — where the value lies in precision, negotiation strategy, and risk mitigation — flat-fee billing creates a healthier, more aligned, and more efficient relationship for everyone involved.

Work With an Attorney Who Values Your Time and Budget

If you are navigating a commercial lease negotiation and want transparent, predictable legal fees, Brent Levison offers flat-fee structures designed to give you clarity from day one.

Contact us today to discuss your leasing needs.

The information in this article is provided for general informational purposes only and does not constitute legal advice. For advice specific to your situation, please consult a qualified attorney.

The post Why Flat-Fee Billing Works Better for Commercial Real Estate Leasing first appeared on Brent Levison.

Here’s what you need to know.

What Is a Franchise Lease Agreement?

A franchise lease agreement is a commercial lease specifically designed for a franchised business. It governs the physical location where the franchisee operates — but unlike a standard retail lease, it layers in requirements and protections from the franchisor as well.

It is not the same as the franchise agreement, which covers brand rights, royalties, and training. The franchise lease is strictly about the real estate.

The Three Parties Involved

One of the key things that sets a franchise lease apart from a standard retail lease is the number of parties involved:

• Landlord — the property owner
• Franchisee — the tenant operating the business
• Franchisor — the brand owner with approval and control rights over the lease

This three-party dynamic creates a more complex negotiation process. The franchisor’s interests and the landlord’s interests don’t always align — and the franchisee is often caught in the middle.

How Franchise Leases Differ From Standard Retail Leases

Common Franchisor Lease Rider Provisions

Most franchisors require a lease rider or addendum that grants them specific protections, including:

• The right to receive notices of default directly from the landlord
• The right to cure tenant defaults to keep the location open
• The right to assume the lease if the franchisee fails
• The right to assign the lease to a new franchisee
• Restrictions on altering the premises without franchisor approval

These provisions are designed to protect the franchisor’s brand continuity — but they can also limit your flexibility as a franchisee.

Who Signs the Franchise Lease?

In most cases, the franchisee signs the lease directly as the tenant. In some systems, the franchisor signs a master lease and subleases to the franchisee — but this is less common.

Franchisees are frequently required to provide personal guaranties, even when operating through an LLC or corporation. This means your personal assets could be on the line if the business fails.

Why Franchise Lease Agreements Matter

A poorly negotiated franchise lease can have serious consequences:

• Increased personal liability
• Higher operating costs (CAM charges, taxes, build-out requirements)
• Limited exit options if you need to sell or close
• Conflicts with franchisor requirements
• Risk to your franchise license itself

Negotiating a franchise lease requires balancing the demands of both the landlord and the franchisor — while protecting your own interests as the operator.

Get Legal Guidance Before You Sign

Franchise lease agreements are complex documents with long-term financial and legal implications. Before signing, it’s strongly recommended to work with an attorney who understands both commercial real estate and franchise law.

Brent Levison has extensive experience in franchise and commercial law. If you have questions about a franchise lease agreement or need guidance before signing, contact us today.

The information in this article is provided for general informational purposes only and does not constitute legal advice. For advice specific to your situation, please consult a qualified attorney.

The post What Is a Franchise Lease Agreement? A Complete Guide for Franchisees first appeared on Brent Levison.

A lease is not just a legal document. It is a business instrument that directly affects profitability, flexibility, and day-to-day operations. When an attorney approaches a lease without a deep grasp of how the client actually functions, the negotiation becomes a technical exercise rather than a strategic one. The result is often a lease that is legally sound but operationally flawed.

Every Business Has Unique Needs

Every business has unique drivers: customer flow, staffing patterns, delivery schedules, storage needs, regulatory constraints, branding requirements, and growth plans. These factors dictate how a space must function.

A medical practice may need after-hours access, specialized build-outs, and strict control over neighboring uses. A restaurant may require venting rights, grease trap access, and predictable delivery logistics. A retailer may depend on visibility, signage, and co-tenancy protections.

Without understanding these nuances, an attorney cannot identify the clauses that matter most — or the risks that could quietly undermine the business.

Understanding Risk Tolerance Shapes Strategy

Listening also uncovers the client’s risk tolerance. Some clients prioritize flexibility and exit rights. Others value stability and predictable occupancy costs. Some are willing to invest heavily in improvements — others need landlord contributions to make the deal viable.

These distinctions shape negotiation strategy. A lawyer who listens can tailor the approach — pushing hard where the client needs protection and conceding where the client sees limited value. This avoids unnecessary conflict and keeps negotiations focused on what truly matters.

Anticipating Problems Before They Arise

Understanding the client’s operations also allows the attorney to anticipate issues the client may not yet see. A sophisticated leasing lawyer can translate business needs into precise, enforceable lease language — but that translation is only possible when the attorney has a full picture of how the business works.

Listening turns the attorney into a strategic advisor rather than a document reviewer.

Listening Builds Long-Term Trust

Moreover, listening builds trust. Clients feel heard, understood, and supported. They are more likely to share concerns early, ask questions freely, and rely on the attorney as a partner in the process.

This leads to better decisions, fewer surprises, and a smoother negotiation. It also strengthens the long-term relationship — critical in a field where clients often return for renewals, expansions, relocations, and new ventures.

The Lease Should Serve the Business

Commercial leasing is not about filling in forms or redlining boilerplate. It is about aligning the lease with the client’s business objectives so the space becomes an asset rather than a constraint.

When an attorney listens deeply and understands the client’s operational goals, the negotiation becomes more strategic, the protections more meaningful, and the final lease more supportive of long-term success.

Work With an Attorney Who Actually Listens

Brent Levison brings extensive experience in commercial real estate leasing — and a commitment to understanding your business before picking up a pen.

Contact us today to discuss your leasing needs.

The information in this article is provided for general informational purposes only and does not constitute legal advice. For advice specific to your situation, please consult a qualified attorney.

The post Why Listening Is the Most Important Skill in Commercial Lease Negotiation first appeared on Brent Levison.

In its 35-page ruling, the court overturned its landmark 1984 decision in Chevron v. Natural Resources Defense Council, which had given rise to the “Chevron doctrine.” That doctrine had required courts to uphold an agency’s reasonable interpretation of an ambiguous statute. But in the new ruling, the court, led by Chief Justice John Roberts, rejected the Chevron doctrine as “fundamentally misguided.”

Justice Elena Kagan dissented, warning that the court’s decision would cause a “massive shock to the legal system.” She was joined in her dissent by Justices Sonia Sotomayor and Ketanji Brown Jackson.

When the Chevron decision was first issued over 40 years ago, it was not seen as particularly consequential. But it eventually became one of the most important rulings on federal administrative law, cited by federal courts more than 18,000 times. While the decision was initially welcomed by conservatives, it later became a target for those seeking to limit the power of the administrative state.

The Chevron decision, which upheld the Reagan-era EPA’s interpretation of the Clean Air Act that eased emissions regulations, was initially praised by conservatives. However, the ruling later became a target for those seeking to limit the administrative state’s power. These critics argued that courts, not federal agencies, should determine the meaning of the law.

In his opinion, Chief Justice Roberts rejected the idea that agencies are better suited than courts to resolve ambiguities in federal laws. He emphasized that Congress expects courts to handle technical statutory questions, with the benefit of briefing from the parties and “friends of the court.”

Moreover, Roberts noted that even if courts should not defer to an agency’s interpretation of an ambiguous statute, they can still consider that interpretation under the Skidmore deference doctrine.

Finally, Roberts characterized the Chevron doctrine as “unworkable” and not worthy of being upheld under the principle of stare decisis. He argued that it is too difficult to determine whether a statute is truly ambiguous, a key criterion for applying the Chevron framework.

The post Chevron Doctrine Reversed: Supreme Court Decision Limits Federal Agency Power first appeared on Brent Levison.

In Florida, the lease, rental, or licensing of commercial real property is subject to state sales tax. This tax encompasses any payment made for the privilege to occupy or utilize the property, including base rent, additional rental fees, and other mandatory payments specified in the lease agreement. Any lessor of real estate must register with the Florida Department of Revenue before engaging in business or entering into a commercial lease.

Over the years, the sales tax rate on commercial rentals in Florida has gradually decreased. Currently set at 4.5%, the state tax on commercial property rentals will be further reduced to 2% effective June 1, 2024. Initially slated for July 1, 2024, this reduction aims to benefit businesses operating in Florida.
Despite the reduction in the state tax rate, counties that impose a surtax will continue to apply it. In 2024, surtax rates vary from 0.5% to 1.5%, with the exception of Collier County, which eliminated the surtax by the end of 2023.

It’s essential to note that each commercial rental property location is considered a distinct entity and necessitates its own tax certificate. While Landlords or their representatives are usually responsible for registering, collecting, and remitting the tax, tenants may become liable for the tax if the landlord fails to meet these obligations. This scenario, known as use tax, may become a concern during a sales tax audit. Lessors and lessees of commercial rentals should carefully review lease agreements for clauses relating to sales taxes, including the tax base calculation and applicable tax rates.

The business rental tax, encompassing rentals of commercial office or retail spaces, warehouses, self-storage units, and mini-warehouses, does not cover sales and use taxes on parking lots, boat docks, and aircraft hangars, as separate regulations govern these categories.

The post Florida’s Reduced Commercial Rental Sales Tax first appeared on Brent Levison.

1. Definition of Hazardous Materials/Hazardous Substances

It’s important to have a clear definition of hazardous materials in the lease agreement. The definition should align with the applicable laws and regulations governing the use, storage, and disposal of hazardous materials. This will ensure the tenant’s compliance with environmental laws, minimize the risk of liability, and protect the property’s value.

2. Compliance with Environmental Laws

Commercial landlords need to ensure that their tenants are compliant with all applicable federal, state, and local environmental laws and regulations related to hazardous materials. The lease agreement should require tenants to obtain all necessary permits and licenses, regularly submit compliance reports, and maintain proper records. By doing so, landlords can protect themselves from potential fines, legal penalties, and reputation damage.

3. Allocation of Responsibilities

It’s essential to clearly allocate responsibilities between the landlord and tenant regarding hazardous materials present on the property. The lease agreement should outline which party is responsible for handling, storing, and disposing of hazardous materials, as well as any required cleaning and remediation. This will help avoid confusion and disputes regarding liability when it comes to hazardous materials on the property.

4. Indemnification and Insurance

Commercial landlords should protect their investments by requiring tenants to indemnify and hold them harmless from any liability resulting from hazardous materials on the property. Tenants should also be required to maintain adequate insurance coverage to cover any potential risks associated with hazardous materials. The insurance should include general liability and environmental impairment liability insurance.

5. Inspection and Remediation

Commercial landlords should have the right to inspect the property for potential hazardous materials and require remediation if necessary. The lease agreement should outline the process for inspections, remediation, and any associated costs. This will ensure that the property is properly maintained, comply with environmental laws, and preserve its value.

In conclusion, negotiating environmental matters such as hazardous materials provisions in retail and office leases requires careful consideration of the legal and environmental risks involved. Commercial landlords should be proactive in protecting their interests by carefully drafting lease agreements that allocate responsibilities, mitigate potential liabilities, and protect the value of their investments.

The post Top 5 Considerations for Commercial Landlords When Negotiating Hazardous Materials Provisions in a Retail or Office Lease first appeared on Brent Levison.

AI is the simulation of human intelligence by machines, especially computer systems. AI chatbots such as ChatGPT are a new technology that is rapidly transforming the internet industry and many job functions across all industries. Chatbots are computer programs designed to simulate conversations with human users and are already replacing human workers in the workplace.

Most of us have been using AI without knowing it. When drafting an email or text message and there are spelling/autocomplete suggestions for sentences, that is AI at work.

Members of the corporate world and Congress have recently expressed concerns about the dangers of AI. They are concerned about AI technologies causing harm, such as facial recognition, that can be used to violate privacy rights. Yet, as of today, no bill has yet been proposed in Congress to protect individuals from the potential harm caused by AI. The aged old problem remains with technology that most lawmakers are just now learning what AI is.

The Federal Trade Commission (FTC) has issued consent orders against companies that have used AI in deceptive ways. In one case, the FTC issued a consent order against a company that deceived consumers about its use of facial recognition technology and its retention of the photos and videos of users who deactivated their accounts.  The FTC has also proposed commercial surveillance rules to restrict the collection of data used in AI technology. 

The FTC has recently issued guidance warning advertisers not to make false or unsubstantiated claims about AI products. The FTC highlighted four major considerations: (1) do not exaggerate what your AI product can do; (2) do not promise that your AI product does something better than a non-AI product without adequate proof; (3) know about the reasonably foreseeable risks and impact of your AI product before putting it on the market (“If something goes wrong – maybe it fails or yields biased results – you can’t just blame a third-party developer of the technology. And you can’t say you’re not responsible because that technology is a ‘black box’ you can’t understand or didn’t know how to test”); and (4) consider whether a product actually uses AI. If a product is not actually AI-enabled, then do not claim that it is an AI product. Merely using an AI tool in the development process is not the same as the product having AI in it. The guidance concludes: “You don’t need a machine to predict what the FTC might do when those claims are unsupported.”

AI is currently being used in the legal industry in many ways, such as assisting with document processing and classification for a wide range of legal matters, including due diligence, contract and document review, contract management, and deal analysis.

This raises the optimistic question: Can AI replace attorneys?

Unfortunately, my answer is no. To the best of my knowledge, AI cannot (at least not yet) do the following, which are done and billed by attorneys:

• Confer with clients to determine their objectives and concerns
• Discern best strategies and avenues to be explored
• Determine what claims are being made in the advertising which require substantiation or confusion to consumers
• Review & Edit an agreement to advance the client’s interests
• Identify potential copyright, trademark and right of publicity issues and provide risk mitigation strategies 
• Provide a risk assessment to a client, such as the risk of a challenge by regulators, competitors or consumers
• Take into account a client’s risk tolerance when providing legal advice

Moreover, an AI chatbot cannot provide legal advice under the rules of professional conduct, meaning no protection of attorney-client privilege for any conversations that a client may engage with an AI chatbot.

Unfortunately for some, despite the advances being made by AI, including in the legal profession, currently, it is unlikely that AI will be able to replace the legal profession. There are differences between providing general legal information and delivering legal advice specific to a client’s needs. AI is adept at building on what has been done before but lacks the creativity and abstract thinking that are required for many legal needs. And some would argue that AI lacks the human touch (more than a lawyer) that embodies or at least creates the important attorney-client relationship and privileges.

The post AI Replace Attorneys first appeared on Brent Levison.

The Use Clause and Exclusive Clause

Landlords typically want to limit how you’ll operate from the rented space. The limitations can be as broad as what type of business you’ll conduct there, as narrow as what specific services or products you’ll offer, or as subjective as the quality level of your operation. A use clause can be either drafted as a restriction on how you do business—stating what you can’t do—or drafted as prescription, describing what you must do.  In general, a tenant wants to avoid strict limitations on the use of the leased premises and keep flexibility and optionality available for growth and business changes, etc.

An exclusive clause in your favor is a commitment by the landlord that only you and no one else in the shopping center or the building may engage in a particular type of business or carry a certain type of merchandise or at least the clause limits the square footage area and gross sales of other tenants on the sale or offering of certain “exclusive” items in order to protect your use and operations.

Restrictive Use Clause

A restrictive use clause states what the tenant is prohibited from doing, such as selling food (or using the space for office purposes). You’re free to do anything that’s not on the list usually subject to any existing exclusive uses at the Shopping Center.

You may be subject to other restrictive use clauses e.g. if the landlord has granted other tenant(s) an “exclusive” clause—a promise that the landlord won’t rent any space to another tenant whose use would compete with the tenant.

Permissive Use Clause

The Permissive use clause states in the Lease what you can do and, by implication, makes any other operations not permitted. It puts the burden on the tenant to carve out every conceivable use at the time you sign the lease. This type of use clause can be very problematic to a tenant, since it can restrict you to a narrow line of operations.

Use Clauses That Help Your Business

Use limitations and provisions are important to negotiate carefully and draft in a very concerted way. Most tenants want protection from competitors or incompatible businesses. For example, an ice cream parlor business could be negatively affected by an ice cream store that opens for operations next door or if you’re a doctor leasing space in a professional building, you want to protect your professional image by having the landlord agree to rent only to compatible tenants such as other professionals or pharmacy or home care equipment rental services.

Obtaining Your Own Exclusive Clause

There’s no reason not to negotiate for an exclusive use clause for yourself. Please keep in mind any existing tenants operating at the Shopping Center will not be subject to your exclusive use since your lease is signed post the other existing tenant leases.

An exclusive use clause is only strong as its remedies, you’ll want to ensure that the landlord agrees to promptly enforce it should another tenant breach its restrictive use clause (and thereby violate your exclusive). Your lease should spell out remedies against the landlord for this type of situation—for example, reduced rent, an option to reduce the lease term or terminate the lease.   Please note the landlord will want a cure period and you should insist on a very limited “cure” period. Most importantly, you’ll want an established amount of monetary damages that you don’t have to prove—the last thing you want is to go to court to prove how much business you lost because another tenant moved into your exclusive.   Please note that most landlords will want to carve out “rogue” tenants from these exclusive use remedies and tenant should do it best to keep the time frame to cure limited and damages strong as it is very likely a competing business will have a negative financial impact to your operations.

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This year Ethical Governance Day will be held on October 18th, 2022, in Miami, Florida, and after two years of only virtual presentations because of the pandemic, I was invited as a distinguished speaker to participate in the event with the Miami-Dade County Public Schools. You can go to their website if you are interested in participating in upcoming events.

I will be making my way into high-school classrooms to address students on the importance of civic participation and engagement to ensure ethical governance and support our democracy.

Civic participation is vital to the health of a democracy. It is essential for citizens to be informed and engaged in the decisions that affect their lives. When people are involved in their communities and in the political process, they are more likely to be satisfied with the direction of their country and trust their government.

Civic participation also helps to ensure that government policies and programs are effective and responsive to the needs of the people. When citizens are involved in the policymaking process, they can provide valuable input on the issues that matter most to them.

Finally, civic participation can help to build social cohesion and community spirit. When people come together to work for the common good, they can develop a sense of pride and ownership in their community. This can lead to increased cooperation and collaboration, and a stronger sense of community.

The post This year Ethical Governance Day at Miami-Dade County Public Schools first appeared on Brent Levison.