USA – SOUTH CAROLINA Law and Practice Contributed by: Matt Norton and Christian Kolic, K&L Gates
tax year. When there are multiple tenants, each tenant will pay its pro rata share based on its pro - portionate share as set forth in the lease. 6.12 Insurance Issues In most commercial leases, the tenant pays directly the cost of insurance on the leased premises. When there are multiple tenants, each tenant will pay its pro rata share based on its proportionate share of square footage in the building as set forth in its lease. Alternatively, the landlord may pay the cost of insurance and be reimbursed on a monthly or annual basis by the tenants. With respect to ground leases, where the tenant typically owns the improvements, the tenant will pay the cost of insurance. Most leased properties are insured against fire and other casualty. In larger projects, terrorism insurance may be included. In certain geograph - ic regions, insurance will include one or more of earthquake, ground subsidence, windstorm and hail, and flood insurance. In addition, many owners of a leased property will carry rent loss and business interruption insurance. 6.13 Restrictions on the Use of Real Estate Landlords are free to restrict the use of leased premises by way of restrictive provisions in the leases. In addition, the permitted uses of leased premises will always be subject to general zon - ing and use limitations applicable to the location of the leased premises irrespective of the provi - sions of the lease. 6.14 Tenant’s Ability to Alter and Improve Real Estate Whether a tenant may alter or improve the lease premises is governed by the terms of the lease. Typically, a lease will expressly prohibit alteration or improvement of the lease premises without
the prior written consent of the landlord. If altera - tion or improvement is allowed, the landlord will require indemnity against mechanic’s liens and other liability from the tenant and require the payment of any additional insurance premiums resulting from the alteration or improvement. The construction or alteration of leased premises will also be subject to the general construction and permitting requirements of the jurisdiction. 6.15 Specific Regulations There are safety regulations applicable to high- density uses, such as multifamily properties, hotels and office buildings, including require - ments for smoke detectors, sprinkler systems, isolated stairwells, firewalls and general resist - ance. High-risk uses may be subject to special regula - tion by the US Department of Homeland Secu - rity. For example, chemical manufacturing facili - ties may be subject to the Chemical Facilities Anti-Terrorism Standards regulations promulgat - ed by the US Department of Homeland Security. These requirements typically include fencing and screening adequate to limit access and sight - lines onto the property. Commercial real property that is to be used for the sale or consumption of alcoholic beverages is subject to regulation under state law as to whether such sale or consumption is permitted on the property. Otherwise, except for gener - ally applicable zoning and land-use regulations, there are no specific regulations or laws that apply to particular categories of commercial real property leases. 6.16 Effect of the Tenant’s Insolvency Insolvency An insolvent tenant who fails to pay rent when due may be evicted from the property, and the
1320 CHAMBERS.COM
Powered by FlippingBook