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What Happens When a Commercial Building Tenant Files For Bankruptcy

Part of the legal questions that are becoming more prominent in this covid-19 period we’re unfortunately in is: how are tenant and landlord legal pursuits handled with businesses being closed due to state stay-at-home orders; and how are bankruptcies handled?


Tenants may use the covid-19 as a means of shelter for non-payment of their lease of rental fees. Of course, this is understandable. Their retail or office business is closed through extraordinary circumstances beyond their control. Business is not as usual. And many landlords have offered a moratorium on lease or rent payments as a means of helping – and this may be an act of moral conscience or was ordered by state authorities.

The relationship between landlords and tenants should ideally be a business-friendly one as opposed to an adversarial one, with professional understandings between both parties as the contractual relationship goes forward. However, that is not always the case, from either the point of view of the landlords or tenants.

Landlords also depend on their income from tenants for their financial wellbeing. So, if tenants can’t pay, then landlords are facing degrees of financial challenges. Much of this is a moral dilemma as well as a legal situation.

A commercial tenant may file for bankruptcy as a result of the covid-19 epidemic. There could be warnings or warning signs of this coming, and a landlord should be in discussion with an experienced commercial real estate law firm like Rodriquez Law Group, Inc. Or, you may have received notice from a bankruptcy court.

There are a number of options for you to pursue, which you need to talk over with an expert, experienced attorney, and which need to be done swiftly.

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