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When is Commercial Real Estate Mediation Appropriate?

Friday, December, 28, 2012


Mediation is a powerful form of alternative dispute resolution (ADR), but there are several factors to consider when determining if it is appropriate for a dispute involving some types of cases.  For example, if the people involved in the dispute are making reasonable efforts to communicate and are inclined to work toward a swift, fair settlement together, mediation is an excellent tool to use.  This includes disputes relating to real estate—even if it centers on a commercial venture.    

Commercial real estate is an area that is open to disputes, especially due to the sheer number of contracts and negotiations that take place and are at the mercy of a volatile market.  However, these disputes are often issues that need to be handled quickly by all parties involved—a fact that has the effect of quickening the resolution. 

In a market where a property can lose value quickly, depending on the economy, reaching a quick resolution to a matter can mean a lot of money saved.  Mediation allows parties involved in a commercial real estate dispute to have complete control over the speed at which the matter is resolved.  However, taking a case through the court system does not promise this kind of quick resolution.  In fact, there are docket numbers and court dates to wait for, and the timeframe of the resolution will be entirely in the hands of a court system and judge. 

Some common disputes that are handled through commercial real estate mediation are:

• Review and calculations of rent due

• Property taxes

• Covenants

• Subletting restrictions

• Changes or improvements to the premises

• Increased or decreases space on leased premises

• Rights of relocation

• Prohibited uses

• Maintenance

• Permissible commercial activities

• Use restrictions

Commercial real estate mediation can also be used as a way to resolve evictions rights disputes, although this borders on the grey area where, depending on the willingness of all parties, other forms of legal dispute resolution might be more appropriate.