Alternate Locate Agreement

An alternate location agreement, also known as an ALA, is a type of agreement commonly used in commercial lease transactions. It allows a tenant to relocate to a different space within the same building or complex if certain conditions are met.

The purpose of an ALA is to give tenants the flexibility to expand or contract their space within a building or complex without having to go through the expense and hassle of moving to a different location. For example, if a tenant outgrows its current space, it may be able to negotiate an ALA that allows it to move to a larger space within the same building or complex when it becomes available.

The terms of an ALA can vary depending on the specific needs of the tenant and the landlord. Some ALAs may require that the tenant pay additional rent or fees if they relocate to a larger space, while others may allow for a rent reduction if the tenant moves to a smaller space.

One of the key benefits of an ALA for tenants is that it can help them avoid having to break a lease and incur the associated costs and legal liabilities. If a tenant is unable to fulfill the terms of its lease, such as paying rent or maintaining the property in good condition, the landlord may be able to terminate the lease and pursue legal action. An ALA can give the tenant an alternative option that is less expensive and less risky.

From a landlord`s perspective, an ALA can help to attract and retain tenants by offering them the flexibility they need to grow and adapt to changing market conditions. It can also help to reduce vacancy rates by allowing tenants to stay within the same building or complex instead of having to look for a new location elsewhere.

In order to negotiate an ALA that works for both parties, it is important to work with an experienced commercial real estate attorney or broker who is familiar with the local market and can help to identify potential issues and solutions. Some of the key factors to consider when negotiating an ALA include the tenant`s current and future space needs, the landlord`s availability of suitable space, and the costs and benefits of the agreement for both parties.

In conclusion, an alternate location agreement can be a valuable tool for tenants and landlords in commercial lease transactions. By providing flexibility and reducing the risks and costs associated with breaking a lease, an ALA can help to create a win-win situation for both parties.

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