Many commercial property leases contain alteration clauses. The alteration clauses specify which alterations the tenant can make and whether they need to notify the landlord first. Many landlords allow their tenants to make minor alterations without notification but require notice for the major alterations.
Below are some of the factors that separate minor and major alterations.
Impact on Other Tenants
A minor alteration does not affect other tenants on the property. For example, other tenants might not care when you subdivide your office into smaller partitions. However, alterations that might affect other tenants require the landlord's input. For example, consult the landlord before installing a standby generator that might pollute the environment with noise or exhaust fumes.
Permit Necessity
Many building permits involve the property's owner. For example, a property owner may need a permit to extend your restaurant's outdoor seating area. In such a case, you definitely have to involve the landlord before you can make the alterations. Moreover, the government typically requires permits only for major alterations.
Effect on Structural Integrity
Inform the landlord before you make any changes that might affect the building's structural integrity or major systems. For example, you should not change the roof, repair the foundation, or upgrade the plumbing system before contacting the owner. Structural changes tend to be major and can have long-term effects on the building.
Effect on Safety
Anything that involves safety issues should involve the landlord. After all, the landlord might face liability claims if someone is injured, say another tenant or a visitor to the property. For example, you should consult the landlord before you renovate the electrical system. Electrical modifications are dangerous since a mistake can trigger an electrical fire.
Effect on Property Value
Most landlords also want you to notify them before you make modifications that affect their property's value. Alterations that reduce the property's value can affect many things for the property:
- Appeal to potential buyers or tenants
- Rental price
- Purchase price
For example, you might affect a building's value after replacing the windows or doors, reducing a parking lot's size, or replacing a skylight. Thus, such modifications require the landlord's involvement.
Ease of Undoing
Some alterations are easy to undo, while others require significant resource investments to undo. For example, you can easily restore the color of a wall - all you need is paint and the painter's service fee. Many landlords will allow you to make such cosmetic changes without informing them.
Effect on External Design
When you rent part of a property, you are likely to have a bigger say in its internal features than the external features. After all, the external features affect other tenants, visitors, and even the community's views on the property.
For example, many landlords won't care about minor alterations inside your office. You can put up temporary partitions or change the carpet without issue. However, most landlords care what you do outside your office. For example, a new pavement or fence requires the landlord's input.
Effect on Utilities
You should always inform the landlord about any alteration that can affect their property's utilities. That is, you should inform the landlord if you want to do something that can affect plumbing, electricity, or gas.
Consider a case where you want to connect an underground fiber optic cable to your office, and you need an excavation that might affect the underground utility supply. Your landlord will definitely want to know about the alterations before you commence them.
Hopefully, you won't have any alteration disputes with your landlord.
Contact
Donald B. Linsky & Associate PA if you ever get into such a dispute. We will help you protect your business and legal rights on the lease.
