Registering a commercial lease

[rslater]

Were negotiating on a large production space for a 5 year lease plus an option to renew for another 5. Our lawyer recommended we register the lease, but most landlords, including this one do not want to do this. Our obvious fear is that if the landlord decides to sell the property, can the new owner kick us out.

Our lawyer is saying this:

Any lease over 3 years is not valid against 3rd parties unless registered.The law is that if it is not registered a new owner could say he is not bound by it. Registration is deemed notice to the world of your 5 year lease plus option. It is common for a landlord to say you are responsible for any costs to register the lease.

The agent of the property is saying this

Landlord will not agree to register any leases in their portfolio. I have not seen this before, other than maybe a 10 year lease. Once you have an executed lease, this lease is valid for the agreed upon terms and conditions, even if the building changes hands.

We truly want the space is the issue. It's hard to gauge if the landlord would even want to sell ever.

Any insights besides our lawyers?

[Energy]

Ooh property law my favorite class.

In general leases under three years total including options to renew do not need to be registered on the title.

The lawyer is right (he should be more knowledgeable than me at least), if you want a lease of five years with an option to renew and you DO NOT register that on the title then the owner can sell the property to another person. This is why long term commercial leases are sometimes not registered as it allows the property owner to sell without the consent of the tenants.

In this case, you can give notice to a prospective purchaser that you have an unregistered long term lease but then if you do not know that there are negotiations going on and the registered owner sells the property and the buyer has NO KNOWLEDGE of the lease when he bought the property then he can kick you out. If the buyer has knowledge of the unregistered lease then it is fraud to evict a tenant.

Always in your best interest to register your interest.

[rslater]

If all the tenants in the building, 4 of them, all have non registered leases exceeding 3 years, then who whomever purchases the property lets say would have to know that their are tenants renting? Naturally when purchasing a building that is divided into units is obviously for rental space, how could someone buying the property not know.

[Energy]

Yes, the buyer would need to know. I don't know how they would not know but if it is true that they don't and their conscience is clear when they purchased the property then the tenants are SOL.

[Morkal]

I think if you have a lease contract with any landlord and he sell the property to another landlord than you don't effected with that because you have a contract with the them and until the contract end no one can force you for leaving the property.