{"id":41765,"date":"2022-11-04T11:59:06","date_gmt":"2022-11-04T09:59:06","guid":{"rendered":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/?p=41765"},"modified":"2025-05-22T13:10:28","modified_gmt":"2025-05-22T10:10:28","slug":"legal-effects-of-covid-19-on-commercial-leases","status":"publish","type":"post","link":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/","title":{"rendered":"Legal Effects of COVID-19 on NYC Commercial Leases"},"content":{"rendered":"\n<p><strong><em>NYC-based boutique law firm\u202f<\/em><\/strong><a href=\"https:\/\/pnlawyers.com\/\" target=\"_blank\" rel=\"noreferrer noopener\"><em><strong>Pardalis &amp;&nbsp;<\/strong><\/em><\/a><strong><em><a href=\"https:\/\/pnlawyers.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">Nohavicka<\/a>\u202fbrings the latest legal updates from the world of&nbsp;<\/em><\/strong><em><strong>real estate. Pardalis &amp; Nohavicka handles an eclectic array of matters, representing individuals and business owners in civil litigation, criminal&nbsp;cases&nbsp;and business transactions, currently litigating and representing clients throughout the United States and around the world.<\/strong>&nbsp;<\/em><\/p>\n\n\n\n<p>If the government declares a state of emergency again due to another public health crisis and initiates a government mandated lockdown, <strong>are you prepared<\/strong>? Legally speaking, that is.<\/p>\n\n\n\n<p>Even after the substantial effect that COVID-19 had on the economy, governments have not publicly changed their stance on how to handle such situations. Consequently, now there is precedence and also mechanisms in place. Therefore, to prepare for what seems inevitable, one needs to know the influence that the pandemic has had on commercial leases.<\/p>\n\n\n\n<p>In short, the result will be dependent on the negotiated terms in the lease. That\u2019s because New York statutes are silent on this matter and, thus, one should not rely on the courts for assistance.<\/p>\n\n\n\n<p>For example, one of the provisions that tenants have tried to rely on to obtain forbearance on rent payments was through a general force majeure clause. However, courts have typically construed this narrowly and ruled that it did not apply to COVID-type situations unless specifically addressed in the lease.<\/p>\n\n\n\n<p>Similarly, tenants have also tried applying the common law defenses of frustration and impossibility doctrines. Broadly speaking, these do allow for unforeseen events to excuse lease obligations<strong>. <\/strong>That said, the burden of proof is very high for a tenant because it must literally be impossible to have used the premises.<\/p>\n\n\n\n<p>Essentially, if a tenant has any possibility of mitigating damages, they are not excused from their lease obligations. As such, the courts will construe this doctrine narrowly and have ruled that the terms called for in the lease are not dependent on profitability.<\/p>\n\n\n\n<p>Ultimately, courts have reaffirmed the sanctity of contract over any perceived injustice because businesses need to consider all risks \u2014 no matter how distant \u2014 in their business plans. This can also be freely negotiated into the lease to the mutual benefit of both parties.<\/p>\n\n\n\n<p>Furthermore, the courts have not favored tenants as one may have expected given the devastating effect on businesses. Hence, it\u2019s imperative for all parties involved to specifically address COVID-type situations in their lease.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>About<\/strong><\/h2>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"alignleft size-thumbnail is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-content\/uploads\/sites\/98\/2022\/11\/John-Pak.jpg?w=150&amp;h=150&amp;crop=1\" alt=\"\" class=\"wp-image-41766\" width=\"150\" height=\"150\"\/><\/figure><\/div>\n\n\n<p><a href=\"mailto:john@pnlawyers.com\"><strong>John Pak<\/strong><\/a>, serves as the Real Estate Chair at the Law Offices of\u00a0Pardalis &amp; Nohavicka. He is a transactional attorney specializing in acquisitions, dispositions and leasing.\u00a0 A graduate of Brooklyn Law School, he received his BA in Political Science from New York University.\u00a0 Prior to joining PN Lawyers, John owned his own private law practice for 15 years and a title company for 6 years.<br \/>______________<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"alignleft\"><img decoding=\"async\" src=\"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-content\/uploads\/sites\/98\/2019\/03\/PropertyShark-Taso-150x150.png\" alt=\"Taso Pardilis\" class=\"wp-image-34836\"\/><\/figure><\/div>\n\n\n<p><strong><a href=\"mailto:taso@pnlawyers.com\" target=\"_blank\" rel=\"noreferrer noopener\">Taso Pardalis<\/a><\/strong>\u00a0is a founding partner of the Law Offices of Pardalis &amp; Nohavicka, a leading full- service NYC law firm with offices in Manhattan, Queens and WeWork. Taso may be a well-known attorney with many cases making headlines in major media outlets, but at heart, he is a true entrepreneur that believes in supporting the small business community. His areas of concentration are: Intellectual Property, Trademarks, Corporate, Business Law and Real Estate Law.<\/p>\n\n\n\n<div style=\"height:6px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Even after the substantial effect that COVID-19 had on the economy, governments have not publicly changed their stance on how to handle such situations.<\/p>\n","protected":false},"author":49,"featured_media":41767,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[11119,9499,328,796],"tags":[11097],"class_list":["post-41765","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-commercial-real-estate","category-legal","category-new-york-real-estate","category-how-to","tag-real-estate-law"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Legal Effects of COVID-19 on NYC Commercial Leases | PropertyShark<\/title>\n<meta name=\"description\" content=\"Even after the substantial effect that COVID-19 had on the economy, governments have not publicly changed their stance on how to handle such situations.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Legal Effects of COVID-19 on NYC Commercial Leases\" \/>\n<meta property=\"og:description\" content=\"Even after the substantial effect that COVID-19 had on the economy, governments have not publicly changed their stance on how to handle such situations.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/\" \/>\n<meta property=\"og:site_name\" content=\"PropertyShark Real Estate Blog\" \/>\n<meta property=\"article:published_time\" content=\"2022-11-04T09:59:06+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-05-22T10:10:28+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-content\/uploads\/sites\/98\/2022\/11\/Legal-Effects-of-COVID-19-on-Commercial-Leases.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"1280\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Eliza Theiss\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Eliza Theiss\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Legal Effects of COVID-19 on NYC Commercial Leases | PropertyShark","description":"Even after the substantial effect that COVID-19 had on the economy, governments have not publicly changed their stance on how to handle such situations.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/","og_locale":"en_US","og_type":"article","og_title":"Legal Effects of COVID-19 on NYC Commercial Leases","og_description":"Even after the substantial effect that COVID-19 had on the economy, governments have not publicly changed their stance on how to handle such situations.","og_url":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/","og_site_name":"PropertyShark Real Estate Blog","article_published_time":"2022-11-04T09:59:06+00:00","article_modified_time":"2025-05-22T10:10:28+00:00","og_image":[{"width":1920,"height":1280,"url":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-content\/uploads\/sites\/98\/2022\/11\/Legal-Effects-of-COVID-19-on-Commercial-Leases.jpg","type":"image\/jpeg"}],"author":"Eliza Theiss","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Eliza Theiss","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/","url":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/","name":"Legal Effects of COVID-19 on NYC Commercial Leases | PropertyShark","isPartOf":{"@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/#primaryimage"},"image":{"@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/#primaryimage"},"thumbnailUrl":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-content\/uploads\/sites\/98\/2022\/11\/Legal-Effects-of-COVID-19-on-Commercial-Leases.jpg","datePublished":"2022-11-04T09:59:06+00:00","dateModified":"2025-05-22T10:10:28+00:00","author":{"@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/#\/schema\/person\/de1353a5de72f96494054df3ecca7de4"},"description":"Even after the substantial effect that COVID-19 had on the economy, governments have not publicly changed their stance on how to handle such situations.","breadcrumb":{"@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/#primaryimage","url":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-content\/uploads\/sites\/98\/2022\/11\/Legal-Effects-of-COVID-19-on-Commercial-Leases.jpg","contentUrl":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-content\/uploads\/sites\/98\/2022\/11\/Legal-Effects-of-COVID-19-on-Commercial-Leases.jpg","width":1920,"height":1280},{"@type":"BreadcrumbList","@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/2022\/11\/04\/legal-effects-of-covid-19-on-commercial-leases\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/"},{"@type":"ListItem","position":2,"name":"Legal Effects of COVID-19 on NYC Commercial Leases"}]},{"@type":"WebSite","@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/#website","url":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/","name":"PropertyShark Real Estate Blog","description":"Market Reports for Real Estate Writers","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/#\/schema\/person\/de1353a5de72f96494054df3ecca7de4","name":"Eliza Theiss","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/96965f7dc4c1c5276e67c2727672b8636c299791a627dca31fda556cf0db9758?s=96&d=retro&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/96965f7dc4c1c5276e67c2727672b8636c299791a627dca31fda556cf0db9758?s=96&d=retro&r=g","caption":"Eliza Theiss"},"description":"Eliza Theiss is a senior writer reporting real estate trends in the US. Her work has been cited by CBS News, Curbed, The Los Angeles Times, and Forbes among others. With an academic background in journalism, Eliza has been covering real estate since 2012. Before joining PropertyShark, Eliza was an associate editor at Multi-Housing News and Commercial Property Executive. She has also contributed extensively to CommercialEdge. Reach her at eliza.theiss@yardi.com","url":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/author\/eliza\/"}]}},"jetpack_featured_media_url":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-content\/uploads\/sites\/98\/2022\/11\/Legal-Effects-of-COVID-19-on-Commercial-Leases.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/posts\/41765","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/users\/49"}],"replies":[{"embeddable":true,"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/comments?post=41765"}],"version-history":[{"count":6,"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/posts\/41765\/revisions"}],"predecessor-version":[{"id":41774,"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/posts\/41765\/revisions\/41774"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/media\/41767"}],"wp:attachment":[{"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/media?parent=41765"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/categories?post=41765"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.propertyshark.com\/Real-Estate-Reports\/wp-json\/wp\/v2\/tags?post=41765"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}