This office lease clause states the conditions under which the landlord can and can not furnish any particular item(s) of work or service which would constitute an expense to portions of the Building during the comparative year.
The Virginia Clause for Grossing Up the Tenant Proportionate Share is an important aspect of commercial lease agreements in Virginia. It is a provision that addresses the issue of increasing the tenant's proportionate share of operating expenses in the event that the building is not fully occupied. The purpose of this clause is to ensure that the landlord is able to recover a proportionate share of the operating expenses, even when the building's occupancy rate is below 100%. By grossing up the tenant's share, the landlord can maintain a steady cash flow to cover expenses such as maintenance, utilities, insurance, and property management fees. There are different types of Virginia Clauses for Grossing Up the Tenant Proportionate Share. Let's explore them: 1. Fixed Gross-Up: This type of clause states a fixed occupancy rate at which the tenant's proportionate share will be grossed up. For example, if the fixed gross-up rate is set at 90%, the tenant will be obligated to pay their proportionate share as if the building is 90% occupied, regardless of the actual occupancy rate. 2. Variable Gross-Up: In contrast to the fixed gross-up, the variable gross-up clause adjusts the tenant's proportionate share based on the actual occupancy rate of the building. This type of clause ensures that the tenant's payment aligns with the current occupancy level, providing a fair and accurate representation of the expenses. 3. Expense Stop Gross-Up: The expense stop gross-up clause is typically used in cases where the landlord wants to limit the amount of reimbursable expenses that the tenant is responsible for, even when the building is not fully occupied. This clause sets a maximum limit for expense recovery, beyond which the landlord will bear the additional costs. 4. Partial Gross-Up: Some lease agreements in Virginia may have a partial gross-up clause, which specifies that only certain operating expenses will be subject to grossing up. This clause allows the landlord to select specific expenses that are necessary to be covered even in low occupancy scenarios. When negotiating a commercial lease agreement that includes the Virginia Clause for Grossing Up the Tenant Proportionate Share, it is important for both parties to carefully review and understand the different types of gross-up provisions. This will help ensure that the terms of the clause align with the specific needs and circumstances of the building, as well as the interests of both the landlord and the tenant.
