You should own their commercial rental property in a limited liability company to protect your other assets and savings from claims and liability for the actions or omissions of tenants, contractors and others. All sophisticated and well-advised owners of real estate do.
Summary. The January 12, 2015, case of Grand Prospect Partners, L.P. v. Ross Dress For Less, Inc., upheld a cotenancy clause, which provided that the tenant was not required to move in and open for business, both if a certain percentage of the retail square footage of the shopping center was not open for business, and if two named tenants were not open for business in their specified square footages of space. The cotenancy clause also allowed the tenant to not pay rent if either test stopped being met, and to terminate the lease if the breach were not cured within twelve months. The trial court refused to enforce the cotenancy clause, resulting in a $4.7 million judgment. The Court of Appeal reversed, allowing Ross to terminate the lease, but making it pay rent for the twelve months it retained control of the leased space, neither using it nor allowing the owner relet it.