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</o:shapelayout></xml><![endif]--></head><body bgcolor=white lang=EN-US link="#0563C1" vlink="#954F72"><div class=WordSection1><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'>Erik,<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'>The lease is onerous, but you need to look to the entire relocation package.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'>The relocation rules allow for up to: 1) $50K in business reestablishment benefits; and<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'>2) unlimited move costs. Move costs include the cost to disconnect, move and reconnect trade fixtures which can be very expensive in a grocery store. <o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'>With regard to the property you need to look to what is being purchased. Is it a trade fixture that can be moved? Is it personal property or inventory which can also be moved.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'>Unless this is one of the last dying outlier Cities that is trying to deny relocation benefits your client will be due relocation under the federal rules as I was successful last year in getting a legislative change to require relocation benefits to all displaced persons and businesses with the overwhelming assistance of Senator Curtis King and his staff.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'>I am more than happy to discuss this further off line if you need any pointers or assistance. <o:p></o:p></span></p><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'><o:p> </o:p></span></p><div><table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 style='border-collapse:collapse'><tr style='height:53.5pt'><td width=115 valign=top style='width:86.0pt;padding:0in 5.75pt 0in 0in;height:53.5pt'><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><img width=105 height=54 id="Picture_x0020_1" src="cid:image001.jpg@01D3D800.F4577BD0" alt=ibdr2><o:p></o:p></span></p></td><td width=450 valign=top style='width:337.75pt;padding:0in 5.75pt 0in 0in;height:53.5pt'><p class=MsoNormal><b><span style='font-size:10.0pt;color:black'>Kinnon W. Williams </span></b><span style='font-size:10.0pt;color:black'>| Shareholder<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:9.0pt;color:black'>Skyline Tower, Suite 1500 | 10900 NE 4<sup>th</sup> Street | Bellevue, WA 98004<o:p></o:p></span></p><p class=MsoNormal style='margin-left:-4.15pt'><span style='font-size:9.0pt;color:black'>P: 425.450.4225 | F: 425.635.7720<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:9.0pt;color:#1F497D'><a href="http://www.insleebest.com/uploads/vcards/kwilliams.vcf"><span style='color:blue'>vCard</span></a> | </span><span style='font-size:11.0pt;color:#1F497D'><a href="http://www.insleebest.com/"><span style='font-size:9.0pt;color:blue'>website</span></a></span><span style='font-size:9.0pt;color:#1F497D'> | </span><u><span style='font-size:9.0pt;color:blue'><a href="mailto:kwilliams@insleebest.com"><span style='color:blue'>kwilliams@insleebest.com</span></a></span></u><span style='font-size:11.0pt;color:#1F497D'><o:p></o:p></span></p></td></tr></table><p class=MsoNormal><span style='font-size:10.0pt;color:black'>This electronic mail transmission is privileged and confidential and is intended only for the review of the party to whom it is addressed. If you have received this transmission in error, please immediately return it to the sender. Unintended transmission shall not constitute waiver of the attorney-client or any other privilege.</span><span style='font-size:10.0pt;color:black'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;color:#1F497D'><o:p> </o:p></span></p></div><p class=MsoNormal><span style='font-size:14.0pt;color:#1F497D'><o:p> </o:p></span></p><div><div style='border:none;border-top:solid #E1E1E1 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal><b><span style='font-size:11.0pt'>From:</span></b><span style='font-size:11.0pt'> wsbarp-bounces@lists.wsbarppt.com [mailto:wsbarp-bounces@lists.wsbarppt.com] <b>On Behalf Of </b>Erik Marks<br><b>Sent:</b> Thursday, April 19, 2018 4:48 PM<br><b>To:</b> wsbarp@lists.wsbarppt.com<br><b>Subject:</b> [WSBARP] Leasehold Condemnation Question<o:p></o:p></span></p></div></div><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><span style='font-size:11.0pt'>Potential tenant is operates a mid-size specialty supermarket, located in-line within a larger shopping center. The entire parcel is subject to a condemnation action. Tenant has 1 year remaining on its lease with an unexcercised 5-year extension term that bumps the rent by only 2%. There is value on the leasehold (below market rent) and replication costs of TI's are in the $4m range. In fact, the Tenant recently purchased the supermarket from its prior operator and payed out-of-pocket money for the under-market lease and in-place TIs. So far, so good. But enter the CBA form Multi-Tenant NNN Lease. The condemnation section reads:<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'><o:p> </o:p></span></p><p class=MsoNormal style='margin-left:.5in'><span style='font-size:11.0pt'>"Landlord shall be entitled to the entire award from the condemning authority attributable to the value of the Premises, the Building or the Property and Tenant shall make no claim for the value of its leasehold. Tenant shall be permitted to make a separate claim against the condemning authority for moving expenses [when a condemnation triggers lease termination], provided that in no event shall Tenant's claim reduce Landlord's award." <o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'>As I read this section, it says that all condemnation proceeds related to the real estate and fixtures is to be paid to the Landlord. And the Tenant will receive only the cost of relocating its personal property ("Moving Expenses"). <o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'>I find it hard to believe that our region's "standard form" commercial lease would/should yield such a prejudice and forfeiture against a tenant. Does anyone have suggestions about how this situation might be approached to find value for the tenant? <o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'>Thank you,<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'>Erik<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:10.5pt;color:black'>-- <o:p></o:p></span></p><p class=MsoNormal><b><i><span style='font-size:10.5pt;font-family:"Arial",sans-serif;color:#4D573A'>Erik G Marks</span></i></b><span style='font-size:10.5pt;color:#4D573A'> </span><span style='font-family:"Times New Roman",serif;color:#4D573A'><o:p></o:p></span></p><div><p class=MsoNormal><b><i><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:#4D573A'>Attorney at Law</span></i></b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:#4D573A'> </span><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:black'><br>2255 Harbor Ave SW</span><span style='font-family:"Times New Roman",serif;color:black'><o:p></o:p></span></p><div><p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:black'>Suite 203</span><span style='font-family:"Times New Roman",serif;color:black'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:black'>Seattle, WA 98126</span><span style='font-family:"Times New Roman",serif;color:black'><o:p></o:p></span></p></div><div><p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:black'><o:p> </o:p></span></p></div></div><p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:black'>office: 206-264-4598 <br>cell: 206-612-8653<br><br></span><u><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:#0000FE'><a href="mailto:erik@egmrealestate.com">erik@egmrealestate.com</a></span></u><span style='font-size:11.0pt'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt'><o:p> </o:p></span></p></div></body></html>