Massachusetts Commercial Lease Agreement

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Restrictions on Certain Lease Clauses as per State Law

Exclusivity, Prohibited Uses, and Radius Restrictions

• Retail leases are often associated with it, though not always.
• It protects the tenant from competition but can harm the landlord.
• It may prohibit leasing to certain competitors and prevent competitors from being in the same building as the tenant.
• Competitors in the building may pose problems in terms of recruiting other employees.
• It may be embarrassing if the competitor’s name is on the tenant’s building.
• It may impose restrictions on certain uses, including subletting.
• Restrictions on uses that aren’t in the best interests of the property/building tenants may be imposed.
• It’s applied to signage rights.
• Examples of penalties for violations include termination rights, rent abatement, and rent reduction.
• Landlords should avoid exclusives as they’re challenging to enforce.

Landlords often have restrictions on leasing their properties to tenants who are competitors within a predetermined trade area. Tenants may also be required to agree not to operate within that same trade area. This is more commonly seen in retail leases, and it’s important to define the radius of the trade area clearly. 

Tenant’s Rights to Withhold Rent for Necessary Repairs

The Massachusetts Supreme Judicial Court has stated that if a landlord fails to maintain a dwelling in a habitable condition, the tenant can withhold some of the rent from the date the landlord is notified of this breach of warranty of habitability. 

Although withholding rent can be a practical approach to force repairs, it’s a serious step that requires careful consideration. It may be wise to seek legal advice before withholding rent, as the landlord may attempt to evict the tenant for non-payment.