Time and Materiality

A recent case from Illinois’ 2nd appellate district, Rubloff CV Machesney, LLC v. World Novelties, Inc., d/b/a Pantera Coffee and Crumbs, No. 2-05-0673 (March 3, 2006), upholds the landlord’s right to terminate a lease on account of a tenant’s default, based on the lease as written. The court dismissed the tenant’s argument that the time computation statute of Illinois should have allowed the tenant to pay its rent on the first business day of the month, rather than by the first calendar day of the month. The court also found that the landlord was entitled to terminate the lease due to the tenant’s continued failure to comply strictly with its obligations under the lease. The court’s discussion of what makes a breach “material” is thorough and careful, and a useful reminder of the procedural complications that can result when a default is required to meet a “materiality” standard before a remedy can be enforced.

Building fitness

RealEstateJournal.com examines a new trend in workplace architecture: office buildings and campuses designed to encourage stair climbers and fitness walkers, all for the promotion of employee health.

Office market rebound

Good news for office landlords from RealEstateJournal.com, which reports dropping vacancy rates, rising absorption rates, and higher rental rates for many of the nation’s office space markets.

Game plan for corporate real estate

Business Facilities‘ cover story features a wide-ranging interview with Roger Staubach, covering topics from long-term leasing and acquisition strategies in corporate real estate, to relocation and growth opportunities in the global economy.

Mega-mixed-use

Inman News takes a look at how futuristic visions of the “vertical city” have come closer to reality in New York’s Time Warner Center, which combines high-end residential, retail and restaurant, office, hospitality and entertainment uses under one roof, with the trend being picked up by developers of several high-rise projects in Las Vegas.

Bankruptcy reform and real estate

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (S. 256) cleared the United States Senate late last week, and moves on to the House of Representatives. Although the consumer-credit aspects of the bill have been widely discussed and hotly debated, the bill also includes several provisions sought and welcomed by the commercial real estate industry, as reported by the National Association of Realtors, including a provision that eliminates the $4 million limit on single-asset bankruptcy filings, and a provision that imposes a firm 210-day limit for a tenant to assume or reject its lease (replacing the current period, which starts at 60 days and is often freely extended in bankruptcy court, sometimes for years, the new bill requires the tenant to make its election within 120 days and allows no more than one extension of up to 90 days). The full text of the bill is available here.

[This post has been updated on March 16, 2005, to clarify the assumption/rejection provisions of the new bill.]

Last call / To do your shopping / At the last mall

Reports of the demise of the traditional shopping mall, greatly exaggerated or not, are surfacing again in the wake of the announced merger of Federated and May: “The Mall Is Dead, Long Live The Mall,” says Retail Traffic Online; Wharton weighs in with a less-than-optimistic view of the fortunes of department store retailing; and Catherine Seipp writes a requiem in NRO.

TRIA Extension Retry

A bill that would extend the Terrorism Risk Insurance Act for an additional two years past its current scheduled expiration date of December 31, 2005, has been reintroduced in the U.S. Senate by a bipartisan group of sponsors, as reported in this article from Buildings.com. (The Dodd-Bennett bill follows on a similar extension bill introduced by Sens. Dodd and Bennett in 2004.) Support for the extension was buttressed by recent testimony from Federal Reserve chairman Alan Greenspan questioning whether terrorism risk can be adequately insured against through private market mechanisms. Links to prior posts on TRIA can be found here.

Green Building Red Tape?

RealEstateJournal.com reports on “green building” certification under the U.S. Green Building Council‘s Leadership in Energy and Environmental Design program, and the current negotiations within the Council to streamline the certification process and cost so that more builders, especially within the retail industry, will be encouraged to “build green”.

Rising signs

An improving economy is leading to lengthier lease terms for office space, according to this article in Buildings.com.