February 2013 Archives

February 28, 2013

Repair and Deduct by Commercial Tenants

It is common for commercial landlords and tenants to have disputes over needed repairs.  Most commercial leases require tenants to make needed repairs to the leased premises while repair and maintenance to the structural elements of the commercial center and its common areas are left to the landlord.  Moreover, even though the landlord maintains the structural elements of the center, those costs are most often passed on to the tenant as common area maintenance expenses (CAMs).   

Escalator.jpgProblems arise where either the landlord or the tenant misconstrue respective responsibilities.  When this happens, commercial tenants are tempted to make the needed repairs and simply deduct the cost from their monthly rent.  Unfortunately, this commonly referred to "repair and deduct" remedy is not available to commercial tenants unless the remedy is specifically provided for in the lease.  Even if the repair and deduct remedy is provided for under the lease, commercial tenants need to be careful about what repairs the landlord is legitimately responsible for under the terms of the lease.  Commercial tenants that mistakenly withhold rent for repairs that weren't the landlord's responsibility or where the lease doesn't specifically provide for the "repair and deduct" remedy risk being evicted (unlawful detainer).  

Where a landlord clearly breaches the lease by failing to make repairs it is obligated to make under the express terms of the lease and there is no "repair and deduct" clause in the lease, commercial tenants are left with the unfortunate and expensive task of suing the landlord seeking declaratory relief (an order forcing the landlord to perform) or damages to compensate the commercial tenant for losses associated with the breach.  See Realities of Pursuing Breach of Contract Actions.  Ideally, San Diego business owners will negotiate with their landlords and look to resolve any outstanding issues amicably.  Otherwise, the costs of battling a commercial landlord in court can be extensive.  

Before making any decisions, the commercial tenant should carefully review its lease regarding the parties' respective obligations and determine whether a "repair and deduct" clause is included.  Understanding the terms of the lease is the best way to ensure that a proper remedy to is sought. Ultimately, consulting with a San Diego commercial lease lawyer is best.
February 8, 2013

The Virtual Office

Modern technology has revolutionized the way we do business.  Digital copies of documents are emailed instantly, faxes are sent via on-line services, fillable digital forms make transferring information simple and efficient, mobile phones allow business people to field calls almost anywhere and a vast array of information is instantly accessible via the internet.  These conveniences reduce the need for receptionists, secretaries and other staff, and as a result reduce the need for physical office space.  Many San Diego business owners find it practical to work from home without the need for any office space, virtual or otherwise.  However, some businesses necessarily require client contact and in such cases it is more important to have an actual office.  Lawyers, accountants, architects, doctors and other professionals must consider the client's first impression.  Meeting at home might convey a host of negative impressions whether real or imagined.  While the home office is becoming more and more accepted, there remains a stigma that professionals in new business ventures seek to avoid.  Yet, the cost of leasing an office can be prohibitive especially for new and growing businesses.

922004_-team_ii-.jpgThe virtual office provides an economical alternative while simultaneously conveying a professional impression on clients.  Moreover, in today's business climate, customers and clients are developing a healthy respect for businesses that are able to keep overhead low.  They recognize that a virtual office results in savings that are passed on to them.  There is a variety of virtual office space available throughout San Diego offering diverse services including the use of offices and/or conference rooms, shared receptionists and secretarial support, phone and internet services and in some cases actual support staff.  

Typically, young professionals are offered a fixed number of hours (say 30) for the reservation of an office or conference room.  They pay a relatively low monthly rent and perform most of their work at a home office.  The virtual office provider can answer the phone for them, take messages and/or transfer calls.  Their mail and deliveries are sent to the virtual office.  When the time comes to meet a client, the professional sets an appointment with the client and reserves an office or conference room through the virtual office provider.  When the client appears for the meeting, he or she is greeted by a receptionist without ever really knowing that they are meeting at a virtual office.  Coffee and other refreshments may be offered, and most of the virtual offices available in San Diego are at prime locations like downtown, Mission Valley or La Jolla.  In short, clients are treated to maximum professionalism for a minimal cost.  The level of service offered by the virtual office provider will depend on the rent agreed to but the rent is always affordable when compared to leasing permanent commercial space.

Twenty to thirty hours of reserved office space is significant client time for most new businesses.  When twenty to thirty hours is no longer sufficient, many of the virtual office providers offer permanent office space.  The rent remains significantly better than most office space by taking advantage of the shared receptionist, conference rooms, scanners, copiers and other office support.  Some providers, such as Intelligent Office in La Jolla offer enhanced services including on-site virtual assistants that will actually help with business tasks.

Ultimately, new business owners are provided maximum flexibility with the virtual office concept.  Most of their work is done at home while clients are treated to a professional environment.  In fact, the home office is now portable.  With a laptop, the new professional can work just about anywhere.  They can even save on day care and take their kids to places like Kid Ventures where parents have access to the internet while their kids are entertained.  Kid Ventures is expanding and considering separate office space with printers, copiers, fax capabilities, phones and yes a virtual office.  The technological possibilities are endless.