Can a Tenant Terminate a lease early due to negative effects of that particular location?

A tenant has been leasing in the same office complex for the past 11 years, about 2 years ago they did a renewal which currently puts them in that location for another 3 years. However, in the last 2 years, that property has suffered considerably and is no longer the "go to" location that is was in the previous years. As a result, the tenants business has been affected negatively and if they stay, it may cause them bankruptcy. They major proplem is that the principal is on the hook with a personal guarantee. After review of the lease, there is wording in the section refering to Landlord Defaults stating "For any default which is material and substantially and adversely impacts Tenants sales and extends beyond the cure period provided above, Tenant, as Tenants sole and exclusive remedy, may terminate this lease" Thoughts???
In Leasing Property - Asked by Bjorn R. - Jul 21, 2010
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Answer(s)

JEFF P.
Broker/Agent
Van Nuys, CA

Bjorn,
This question require more knowledge about the situation and the specific lease document. The short answer based on your above statements is probably not.
Even if the lease has a clause where the landlord is responsible for maintaining the property and the landlord is in "default" for not doing so, most leases have a cure period for such defaults. If the default is cured, the Landlord would not be in Breach of the lease for that specific default.
Has the tenant notified the landlord of such a default? If not, no cure period has begun, therefore the landlord wouldn't be in Breach and the tenant has no grounds for terminating the lease based on your above statements.
Good luck!

Jul 21, 2010
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Robert D.
Property/Asset Manager
Newton, MA

If the landlord is not maintaining the condition of the property at least to the extent that the tenant moved in and there is such wording to that effect in the lease, then the tenant does have a leg to stand on.

Jul 29, 2010
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Dawn L.
Broker/Agent
Boca Raton, FL

Bjorn:
When you state in the last two years the "property has suffered considerably and is no longer the 'go-to' location", do you mean that the landlord has been neglectful of maintaining the property, or another similar property nearby that is newer or been fixed up has taken some of the tenant's business?
I think we need more information before that question can be answered correctly and to everyone's satisfaction.
However, if it is an issue with the landlord not maintaining the property, there are a variety of methods available. I would suggest the tenant seek the advise of an attorney specializing in tenant issues to ascertain what can be done to persuade owner to stand up.
There are always options.
Hope this helps.

Jul 30, 2010
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