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Fair Market Rent: Avoiding Its Commonly Uncommon Meaning…and Litigation
It has been said that “Prediction is very difficult, especially if it’s about the future.” The adage certainly applies when negotiating and drafting commercial leases. The clarity of certain contract terms and the consideration of potential pitfalls can mean the difference between an unambiguous, mutually beneficial lease and expensive litigation that leads to the liquidation of one of the parties’ businesses. From the litigator’s perspective, among the trickiest drafting tasks can be establishing a framework for determining fair market rent (“FMR”) when that term is used in a lease.
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