Whether you are a commercial landlord or a tenant, you need to know what an FRI lease is and how it may be used. It is much different than a traditional commercial lease and puts more responsibility on the tenant.
This can be a good thing for the property owner, though it may represent a cost to the tenant and make the property less attractive than it would be otherwise.
A lease that requires full repairs
To start with, FRI stands for “fully repairing and insuring.” It generally means that complete repairs are not only the responsibility of the tenant but must be made by that tenant when they take on the lease. This could mean even making repairs as soon as they occupy the space. Overall, an FRI lease goes beyond just maintaining the space and may encourage a tenant to take drastic steps in upkeep and repair.
Some tenants like this because it gives them full control of what space will look like and how they can use it. Others do not like these leases because they want the landlord to make the basic repairs, while they just decorate the space and set it up to serve the needs of the business.
Both sides must know how this works, though, because a tenant who violates an FRI lease may end up getting evicted and could feel that it is unfair, as they assumed the owner would make repairs.
Exploring your legal options
Disputes over repairs do happen with commercial properties. If you wind up in one, it is time to explore all of the legal options at your disposal.