Leases, Contracts and Agreements Important to Any New Restaurant

Filed Under (Construction of a New Restaurant, Negotiating Restaurant Leases, Planning a Restaurant) by Larry on 06-07-2009

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We have tried to keep you up to date of all the problems, plans and changes that occur when buying, owning or starting a new restaurant. One of the early posts included lease negotiations and the importance of getting verbal assurances and other matters in writing. We are now faced with enforcing a lease provision the landlord is tryng to avoid.

In our lease agreement we had a provision that called for the landlord to warrant that the exisiting air conditioning was sufficient to run a restaurant. At the time I was very suspicious that there was enough capacity from my experience in other operations. The landlord had an “expert” do an engineering report that said there was enough cooling. Experts and consultants for anything don’t run restaurants! We insisted that a provision be put in the lease regardless of the engineer’s report.

Since we built the restaurant in the fall, outside temperatures here in Florida were moderate. However, now that summer is in full force, temperatures are in the low 90’s outside. The summer heat, a full restaurant and doors opening and closing find us with 80 degree inside temperatures. Customers are uncomfortable in busy times and many have expressed their displeasure.

The landlord was notified of the problem in early June and has done little to address the situation. Little, that is, until we asked our attorney to pursue the matter and enforce the clause inserted in the lease. Now they have sent HVAC people out to make “minor adjustments”. Nothing has changed. This week we will probably have to file an action in civil court to enforce the lease provision. We will post the results and on going problem resolution.

As a side note, we also had a provision in the lease that says if there is a dispute between the landlord and the tenant that requires an attorney to become involved, the winner of the action pays for the attorney fees of the other party. We are confident the owner will need to pay our attorney and costs.