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Mediation for disputes in CRE

On Behalf of | Oct 7, 2021 | Commercial Real Estate |

When legal disputes arise in commercial real estate, serving an action or requesting a judge isn’t always necessary. Disagreements in New Jersey real estate are also solved through mediation. Mediators are those who work in the same manner that teachers and coaches do when resolving disputes between students. The help of an outside perspective, certainly a legal one, is necessary when professionals have to quickly solve their differences. Here’s a better look at lease disputes and how they’re best resolved through mediation.

When legal action would reduce property value

In commercial real estate, the value of your property is deeply tied to your commercial zoning. Making property disputes public within court could force a municipality to ultimately revoke your zoning. These judgments may lead to a property losing value or being entirely seized by a government authority. Mediation, therefore, is an ideal way of keeping property value private.

When leases are interpreted differently

Interpretation makes for a valid court case when property disputes remain unresolved. Both tenants and landlords must agree in writing before a lease is binding. In some cases, however, things as sensitive as wording get used against you. As long as they have a legal background, a mediator in this example gives you an outside view. Such would lead to lease revisions but not in a courtroom. Following are reasons mediation becomes necessary in property disputes:

  • Renovations and repairs
  • A lease close to its expiration date
  • Commercial rights or zoning being breached
  • Maintenance and property-damage issues
  • Property’s original boundaries have decreased

When compromise is the best solution

A compromise is a powerful option if your opposing course would be costly or made public. The privacy you keep during mediation also educates you. Business laws and those that govern CRE have to be respected. However, what those laws are or how they work isn’t always clear. Overall, it’s in your interest to delay public action until there’s no other remedy. Mediation is a solution when you can compromise but simply aren’t sure how to do so.