I’m starting a billboard advertising company and have secured a land lease with the property owner to place a billboard on the land. However, the land is leased by a separate business.
My question is, since the tenant leases the entire property, does the landowner actually have the right to lease me space for the billboard without the tenant’s permission? Am I required to get the tenants permission as well or can i build without it? Should I ask the property owner for a copy of their lease with the tenant (would they even give it to me?)
If I need the tenant’s permission the deal is basically killed because there is virtually no benefit to the tenant, it’s a billboard on their business’s lot and the ground rent would be paid to the owner, not the tenant. Additionally, what happens when tenants change? I need permission from every new tenant? I find it hard to believe I need the tenant’s permission otherwise no billboards would ever get built on 90% of the places they currently exist (plaza’s, business lots etc).
The billboard land lease includes several warranties specifying that the owner has the authority to enter into the lease and that there is no existing tenant restrictions on the property that prohibit billboard signs, however I don’t want to take the chance on building it only to get sued by the tenant.
Location: Canada
TIA
Comments
It depends on the contract the owner has with their tenant. You aren’t privy to that. I would make sure that the contract you do sign covers you/indemnifies you in case that becomes an issue.
Any violation of the lease is between the landlord and their tenant. You might get caught in the middle of a legal battle but wouldn’t be directly sued
Might have to sue the property owner if your billboard ends up being removed
> Additionally, what happens when tenants change?
Future leases by the landlord would address existing fixtures