New California Law Protects Commercial Tenants

A new California law adds new protections for small commercial tenants, including fair notice of rent increase or termination of tenancy requirements, reports Oscar Perry Abello in Next City.

The law is meant to even the playing field for small business owners and nonprofits and limit the reach of institutional investors unfamiliar with the local community. “Businesses covered under the new law have the right to a lease written in the language that was used for negotiation with the landlord, security deposits limited to one month’s rent, and a right for documentation from landlords that explains how building maintenance fees are calculated, including any new increases in fees.” 

Abello points out that speculative development by large investors has followed the expansion of the Los Angeles Metro rail system, which is finally building stations in some of the city’s historically underserved neighborhoods. Elsewhere in California, the rise of the tech industry in the San Francisco Bay Area fueled similar speculation, displacement, and gentrification.

According to Abello, “Pushing for these new commercial tenant rights is part of a multi-pronged strategy to counteract the real estate speculation displacing small businesses.” Cities like Los Angeles are also launching programs aimed at supporting legacy businesses and preventing their displacement, while activist organizations are banding together to help business owner groups purchase properties through community land trusts and other mechanisms.