GRP Rainer LLP

Commercial Rental Spaces in the Case of Mixed Use of the Rental Premises?

The classification of a rental space as either a residential or commercial tenancy conforms to the emphasis given by the lease tenancy agreement.


Cologne, NRW -- (SBWIRE) -- 06/18/2013 -- GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Bremen, Dusseldorf, Essen, Frankfurt, Hamburg, Hanover, Munich, Nuremberg, Stuttgart and London conclude: The classification of a lease as a residential or commercial tenancy agreement will vary especially depending on what the parties have agreed in the conclusion of the contract. This was decided by the Court of Appeal in Berlin in its judgment from June 2010 (Az. 12 U 51/09). According to that judgment, the emphasis given by the lease tenancy agreement should be decisive as to its classification. Within the framework of a review, all circumstances of an individual case should be acknowledged. If the rental of spaces follows for a purpose that does not have the character of a housing or residential space, then general tenancy law would apply.

For example, the term of the lease, the choice of the order of importance of intended uses as well as the specified square footage for each use should be definitively determined.

The classification of a lease as a residential or commercial rental agreement may lead to far-reaching consequences for the contracting parties of the lease. Many provisions for the protection of tenants apply only to tenancies of housing or residential spaces. In particular, neither a special protection against termination nor the so-called social clause, the right of the lessee to object to termination, exists for commercial property tenancies.

In commercial tenancy law, the structuring of the lease may be of existential importance since commercial leases are often entered into for a long time and considerable investment has been made for the conversion of rental properties. Therefore, tenants should check the lease in the beginning with an attorney, prior to the conclusion of a contract, to avoid confusion that may arise later.

Also, this helps in structuring leases for landlords and tenants of commercial properties. In doing so, interests are incorporated from the outset throughout the agreements of the contract.

About GRP Rainer LLP
GRP Rainer LLP is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Essen, Frankfurt, Hamburg, Hannover, Munich, Stuttgart, Bremen, Nuremberg and London UK.
Contact Michael Rainer
Lawyer, Managing Partner

GRP Rainer LLP
Hohenzollernring 21-23
50672 Cologne

Phone: +49 221-27 22 75-0 click my link