September-October 2022 - 35

LEGAL MATTERS
rent will be calculated during the option period. If your
lease does not include a means by which rent during the
option period is calculated, it might be an indicator that
your option is not really an enforceable option but rather
an agreement to agree in the future. In this circumstance,
if you cannot reach an agreement with the airport/landlord
on the rent for the option period, you may be without a
valid and enforceable option. If presented with an action
seeking to enforce the option, depending on the jurisdiction,
a court may be reluctant to force an agreement.
What happens if you don't have an option or have exhausted
your options, but want to continue to lease your airport property?
The answer and approach differ depending on whether
your landlord is a private entity or municipality. If your
landlord is a private entity, reach out to your landlord as
early as possible and discuss your desire to remain at the
airport and work with the landlord to determine if you
can reach mutually agreeable terms upon which you can
stay at the airport.
If your landlord is a municipality, the process is a bit
more challenging. Therefore, you need to do your research
and develop a strategy before reaching out to your landlord.
You should determine what your landlord's practices are
with respect to extensions and/or renewals. First, are there
procurement laws that your landlord is required to follow?
Is the landlord required to adhere to a competitive bidding
process? If so, when will the landlord issue a request for
proposal (RFP)? If the landlord is not required to adhere to
a competitive bidding process, how has it treated expiring
leases for similarly situated tenants when their lease expired?
Freedom of Information Act/Public Records Requests can
provide you with information on other tenants' leases on
the airfield as well as details relating to how the landlord
uses RFPs. Gathering these details will educate you on
what you should expect. If the airport is federally obligated
and your lease is with the airport sponsor (the entity that
was provided the federal funding), you should expect to
be treated similarly to others who are similarly situated.
The reason is because in accepting the federal funding,
the airport sponsor agreed to adhere to certain federal
grant obligations, including Federal Grant Assurance 22,
Economic Nondiscrimination, which precludes an airport
sponsor from discriminating against any tenant, and Federal
Grant Assurance 23, Exclusive Rights, which precludes the
airport sponsor from providing any tenant with an exclusive
right. Therefore, if your research reveals that the airport
sponsor tends to negotiate new leases without a requiring
competitive bidding, you should expect that the airport
sponsor will similarly negotiate with you. If, however, the
airport sponsor usually puts out an RFP for property after
the lease expires, you should expect to have to respond to
an RFP and compete to continue your lease.
If you find that you must engage in a competitive
bidding process, don't hesitate to remind the landlord
of your stellar performance under the prior lease and the
benefits that your tenancy brought to the airport and the
community in general.
What should you expect if you are surrendering the premises
at the end of your lease?
The initial term has expired, the options have been exercised
or a conscious decision has been made to not extend the lease,
now the premises will need to be surrendered. Provisions
and requirements for surrendering the premises at the conclusion
of your term vary widely depending on the terms that
you negotiated with your landlord at the outset of your lease.
You should be particularly mindful of the provisions relating
to the condition of the premises at the time of surrender.
Commonly, leases require the premises to be in broom swept
condition and that all improvements revert to the landlord
at the termination of the lease. It is not unusual, however,
to see requirements for the premises to be restored to the
condition they were in at the start of the lease. What does
that mean when you have made significant and substantial
improvements to the premises including constructing a
hangar that has a significant useful life remaining? Does
that mean you will be required to remove the hangar from
the premises prior to surrendering? Before you go destroying
and removing the improvements, reach out to your landlord
and discuss it with them. While your lease may require the
improvements to be removed, your landlord may find the
improvements useful and ask you to leave them. A landlord
retaining improvements constructed by tenant during the
lease may require an engineers report demonstrating that
the structural integrity and functional utility of the building
are satisfactory. Check your lease for this type of provision
and be prepared to provide same. It may be a significant
cost. Offering an engineering report to a landlord may yield
a solution agreeable to both tenant and landlord.
The end of a lease term can be a confusing and stressful
time. Many issues can be avoided and minimized by
negotiating terms for option periods and surrender at the
outset and/or careful planning as your lease nears the end
of the term. 
ABOUT THE AUTHORS
ALISON SQUICCIMARRO
Alison L. Squiccimarro is an attorney with the Law
Offices of Paul A. Lange, LLC with offices in New York
and Connecticut. Squiccimarro's nationwide practice
focuses on aviation-related commercial litigation
with an emphasis on FAA and DOT regulatory issues,
airports, insurance coverage and employment
matters. Additionally, Squiccimarro co-chairs the
American Bar Association Forum on Air & Space
Law's Airports Committee.
AMBER ECKART
Amber Eckart, paralegal, regularly assists in the firm's
handling of airport matters and co-authored this article.
SEPTEMBER/OCTOBER 2022 \ AVIATIONPROS.COM / 35
http://www.AVIATIONPROS.COM
September-October 2022

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