A lease signed on 30 July 2024 stipulates the size of the premises, has two architects confirm it against a named national standard, and then takes it back in one sentence.
The tenant is Lexicon Pharmaceuticals, Inc. The landlord is RFL No. 4 Limited Partnership. The premises are Suite 1100 on the eleventh floor of Research Forest Lakeside Building 4, 2445 Technology Forest Boulevard, The Woodlands, Texas.[1] Item 3 of the Basic Lease Provisions gives the number: “25,368 square feet of Rentable Area (which includes a 10.74% single tenant add-on factor and a 16.27% multi-tenant add-on factor).” Paragraph 2(d) says how that number was arrived at and what can happen to it:
“The parties agree that for all purposes hereunder the Premises shall be stipulated to contain the number of square feet of Rentable Area described in Item 3 of the Basic Lease Provisions, and have been confirmed by Landlord’s architect and Tenant’s architect based on ANSI/BOMA Standard Z65.1 - 2017 Method A (the “BOMA Standard”).”
Two architects, one standard, one agreed figure. Then, after a sentence about expansion and contraction space, the paragraph continues:
“Notwithstanding the foregoing, following the initial Term, Landlord may remeasure the Premises and the Building in accordance with the BOMA Standard and in the event of any adjustments to estimated Rentable Areas of the Building and/or the Premises set forth in Item 3 of the Basic Lease Provisions, all rental and other amounts set forth in the Basic Lease Provisions that are calculated based on the Rentable Area(s) of the Building and/or the Premises also shall be appropriately adjusted pursuant to an amendment to this Lease.”
The initial Term runs from 1 September 2025 to 31 January 2031, sixty-five months. Base rent starts at $30.50 per square foot of Rentable Area and climbs to $34.51 in the final period. Operating costs were estimated at $12.29 per square foot of Rentable Area for 2024. Every one of those numbers is a rate multiplied by 25,368, and the renewal option in Exhibit I is priced the same way. So when the clause says “all rental and other amounts … shall be appropriately adjusted,” it means that one day in late 2030, before Lexicon decides whether to renew, a surveyor hired by the landlord may hand back a bigger number, and the renewal rent Lexicon negotiates in dollars per foot gets multiplied by it.
Nothing about the suite changes. Nobody moves a wall.
What 25,368 feet actually are#
Rentable area is not floor space. It is floor space plus a share of the parts of the building nobody leases: lobbies, corridors, restrooms, mechanical rooms, the fitness center. The share is the load factor, or in this lease the add-on factor, and Item 3 is unusually frank about carrying two of them, 10.74% and 16.27%.
Under Method A of the office standard, loading happens in two steps. Usable area on the floor is grossed up by a floor-level factor to a floor rentable figure, then grossed up again by a building-level factor. Reading Lexicon’s two add-ons that way, the usable area behind 25,368 is 25,368 divided by 1.1074 and again by 1.1627, which is 19,702 square feet. The add-on is 5,666 square feet, 22.3% of the number Lexicon pays on.[2]
That reading is an assumption about how the two factors combine, and the lease does not say. If instead they are additive, a combined 27.01% loading, the usable area is 19,973 and the add-on 5,395. The gap between the two readings is 271 square feet, about $8,300 a year at the lease’s first-year all-in rate, and no provision in the document resolves it.
Either way the practical figure is this. Lexicon’s first-year base rent is $773,724 and its estimated operating cost share is $311,773, so $1,085,497 a year. Divided by the space its employees can stand in, that is about $55 per usable square foot against a headline of $30.50 plus $12.29. The add-on is not a trick. It is how American office leases have been written since the 1950s, and the alternative is a landlord charging for the lobby twice by some other route. What matters is that 22% of the rent rides on a number produced by a measuring exercise, and that this lease lets the landlord run that exercise again.
The stipulated proportionate share works the same way. Item 4 fixes Tenant’s Proportionate Share of Operating Costs at 8.85%, which the lease elsewhere says “the parties stipulate to be 8.85% as of the date of this Lease.” The arithmetic checks: 25,368 over the stated Building Size of 286,575 is 8.8521%. That is a fraction with the premises on top and the building on the bottom, and Paragraph 2(d) lets the landlord remeasure both. Remeasure only the numerator and the share rises. Remeasure both by the same percentage and the share does not move at all, while base rent still does, because base rent is a rate times the numerator alone.
The standard changed in 2024#
ANSI/BOMA Z65.1-2017 was the current office measurement standard when Lexicon signed. It is not any more. The 2024 revision changed, among other things, how outdoor space counts. Under 2017, a ground-level patio or courtyard rarely entered rentable area unless it was covered and exclusively one tenant’s. Under 2024, ground-level outdoor areas built as a tenant amenity are included, covered or not. Tenant balconies and rooftop terraces moved the other way, into a new category called Non-Allocated Tenant Area, measured at 100% with no load factor applied. Occupant storage moved out of rentable exclusions and into rentable area, unloaded. Method B, the single load factor approach, was rewritten.[3]
Stack those changes up on a building with a landscaped forecourt and ground-floor amenity terraces and the rentable area goes up without a single square foot of construction. Stevenson Systems, whose people worked on the revision, says its recent engagements have found 3 to 4% of additional rentable area in Class A properties, and prices it: “On a 400,000 SF building at $40 per foot and a 6% cap rate, a 3% finding is worth roughly $8M in capitalized value."[4] The arithmetic is 12,000 found feet, $480,000 of annual revenue, divided by 0.06. Laser scanning vendors are now selling the service under titles like “BOMA 2024 vs 2017: How to Increase Rentable Area."[5] That is the demand side of this clause, stated out loud by the people who meet it.
Which brings up a drafting detail in Lexicon’s Paragraph 2(d) that is easy to read past. The defined term “BOMA Standard” means ANSI/BOMA Z65.1-2017 Method A, full stop. The phrase “or its successor” appears exactly once, in the sentence about expansion and contraction space, where remeasurement happens “in accordance with such BOMA Standard, or its successor, or if the BOMA Standard is discontinued, in accordance with the then prevailing standard used for calculating rentable area of space in Comparable Building.” The post-term remeasurement sentence that follows does not carry that language. It says “in accordance with the BOMA Standard,” the defined term, which on its face is 2017 Method A and not the 2024 revision.
I do not know of a decision construing that distinction, and a landlord would argue that a successor standard is what everybody meant. But as the document reads, Lexicon’s renewal remeasurement is anchored to the version two architects already applied to produce 25,368, and the revision that moves the forecourt into rentable area is not the standard named for that job. One clause got the successor language and the other did not, in the same paragraph, which is the kind of asymmetry that only looks deliberate once somebody is paying for it.
Three other leases, three other answers#
Design Therapeutics took the expansion of Suite 210 at 6005 Hidden Valley Road in Carlsbad, California, in a First Amendment effective 18 March 2022. Recital B describes “an additional approximate 4,900 rentable square feet comprised of Suite 210 (subject to remeasurement).” Section 4 is headed “Rentable Area” and gives the landlord exactly one chance:
“Landlord may remeasure the rentable square footage amounts of the Expansion Premises after Substantial Completion (” Initial Remeasurement “), which may differ from those set forth in this First Amendment, in which case, Landlord may correct all amounts, percentages and figures appearing or referred to in this First Amendment based upon rentable square feet (including, without limitation, the amount of the Expansion Premises Base Rent and Tenant’s Share) by written notice to Tenant. For the avoidance of doubt, Landlord shall not again remeasure the rentable square footage of the Expansion Premises during the Expansion Premises Term after the Initial Remeasurement."[6]
The second sentence is the whole negotiation. A landlord building out a suite has a real reason to measure it once the walls are up, because 4,900 is a space plan estimate and the finished room is what it is. What a landlord does not need is to do it again in year four. “For the avoidance of doubt” is the giveaway that somebody on the tenant side asked.
Tenaya Therapeutics went further. Its First Amendment with HCP Oyster Point III LLC, dated 14 June 2024, concerns roughly 32,370 rentable square feet on the fifth floor at 171 Oyster Point Boulevard in South San Francisco, under a lease originally dated 6 September 2016. Section 12 is two lines:
“12. No Remeasurement . Landlord’s right to remeasure the Premises under Section 1.2 of the Lease is hereby deleted."[7]
Section 1.2 of the 2016 lease is not in the filed exhibit, so what exactly was deleted is not quotable from this document. The useful information is structural: the right was in the original lease, it survived eight years, and when the parties sat down to amend, a tenant with leverage spent a numbered section removing it and the landlord agreed. Section 12 sits between a paragraph relieving Tenaya of restoring its alterations and a paragraph confirming The Column Group is not a guarantor. That is the company a remeasurement right keeps: the list of things a tenant buys back when it has something the landlord wants.
Then there is the version that never allows it at all. Organogenesis took a sublease from Shire Holdings US AG, dated for reference purposes as of 18 March 2014, covering 69,265 rentable square feet in two pieces, 56,489 of Base Premises and 12,776 in Suite 600. Section 1 closes the door:
“Sublandlord and Subtenant hereby acknowledge and agree that the Rentable Area of the Premises shall not be subject to remeasurement or adjustment, nor shall Base Sublease Rent or Extension Term Rent under this Sublease be subject to modification if the actual size of the Premises differs from the Rentable Area of the Premises set forth in this Section."[8]
Read that against Lexicon’s Paragraph 2(d) and they are answering one question in opposite directions. Lexicon stipulates the area and reserves remeasurement after the term. Organogenesis stipulates the area and says the rent does not move even if the real room turns out to be a different size. The Organogenesis clause names the extension term expressly, which is the clause doing the thing Lexicon’s does not: protecting the renewal, where the exposure lives.
It is also worth saying what kind of document that is. A sublandlord passing through space it already pays for has no reason to want a remeasurement right, because it cannot raise what it pays upstairs by finding feet. The symmetry of interest makes the clause cheap. In a direct lease it is expensive.
The clause that says the number is only an approximation#
Suppose the lease has no remeasurement right and the stated size is simply wrong. Kelly McClain, who ran a store called A+ Teaching Supplies, signed a lease with Octagon Plaza, LLC on 28 February 2003 for a unit in a Valencia, California shopping center. The form was the American Industrial Real Estate Association “Standard Industrial/Commercial Multi-Tenant Lease-Net.” Paragraph 1.2(a) described the unit as “approximately 2,624 square feet,” and a diagram attached to the lease said 2,624. At $1.45 per square foot per month, base rent was $3,804. Paragraph 1.6 put her share of Common Area Operating Expenses at 23%.
Paragraph 2.1 said this:
“… Unless otherwise provided herein, any statement of size set forth in this Lease, or that may have been used in calculating Rent, is an approximation which the Parties agree is reasonable and any payments based thereon are not subject to revision whether or not the actual size is more or less.”
That is the clause a landlord’s counsel points at when a tenant arrives with a tape measure. McClain had asked, before signing, for the size to be confirmed. According to her complaint the principals of Octagon “purported to be offended by her inquiries,” said measuring would be unreasonably costly because of the unit’s unusual angles, and insisted they knew every detail of the center and she could rely on them.
In early 2005 she got hold of Octagon’s earthquake insurance application. It put the shopping center at 12,800 square feet, not the 11,835 used to compute her share. Her own unit measured about 2,438 square feet, not 2,624. Correct base rent at the agreed rate would have been $3,535.10 a month, and her correct share of common expenses 19% rather than 23%. She alleged more than $90,000 of excess rent over the term.[9]
The trial court threw the misrepresentation claim out on demurrer. The California Court of Appeal reversed on 31 January 2008. On paragraph 2.1 it held:
“As to element (1), a stipulation intended to bar a party’s fraud claims does not bind the party, and thus the insertion of language agreeing that a material misrepresentation is ‘reasonable’ is of no effect.”
And on the no-revision half, the court said that to the extent the clause purported to insulate Octagon from liability for any discrepancy, no matter how great, between the actual square footage and the figure in the lease:
“it is akin to an ‘as is’ clause. California courts have routinely rejected such clauses as ineffective in insulating a contracting party from fraud claims regarding nonobvious defects in goods.”
The discrepancies were small. The court said so: 186 square feet, 7.6% of the unit’s actual size, and 965 square feet, 8.15% of the center’s. It leaned on Furla v. Jon Douglas Co., a 1998 case about a residential listing, for the proposition that an approximation can still be a misrepresentation: “We cannot say that no reasonable jury could conclude that an ‘approximation’ of square footage which is wildly exaggerated amounts to an actionable misrepresentation of fact."[10]
Two things about McClain are easy to oversell. First, it is a pleading decision. The court held the allegations sufficient, not proven. Second, McClain lost the piece of the case a tenant would most want. Her claim for breach of the implied covenant of good faith and fair dealing was dismissed and the appellate court agreed with the dismissal, because the covenant does not create an obligation at odds with the express terms, and the express terms said the size was an approximation not subject to revision. So the clause did its contract job and failed only against the tort. A tenant with a stipulated-area clause and no evidence of what the landlord knew has, on this authority, nothing.
By my arithmetic the base rent slice of McClain’s loss was $268.90 a month over a 62 month term, about $16,672. The rest of the $90,000 she alleged came from the common expense share, four percentage points applied to whatever the center spent. The denominator was worth more than the numerator.
And the denominator is where the money usually is#
Which is the lesson of the other California case. Thrifty Payless, Inc., doing business as Rite Aid, is a tenant at The Americana at Brand in Glendale. Before the center was built, the landlord’s letters of intent gave per-square-foot estimates for taxes, insurance and common area maintenance, and a CAM budget sent on about 1 September 2004 said the total participating in the sharing would be 450,000 square feet of gross leasable area, putting Thrifty’s proportionate share at 2.2%.
The executed lease, dated about 22 February 2005, said Thrifty would pay its pro rata share and contained no figure or percentage at all. Paragraph 6.8.1 defined the share as the Floor Area of the Premises divided by the Floor Area of the Retail Center “which is leased and occupied by tenants as of the commencement of the applicable calendar year,” excluding the floor area of certain Other Stores.
In 2009, the first full year the charges ran, Thrifty’s actual share was 5.67%. CAM came in at $412,307 against $211,874 at the rate in the final letter of intent. Taxes were $169,686 against $43,836. The trial court sustained a demurrer, holding estimates cannot ground a fraud claim. The Court of Appeal reversed on 19 July 2013, and the California Supreme Court denied review that October.[11]
The mechanism is worth seeing plainly. Thrifty’s floor area never changed. The denominator did, because the lease defined it as space “leased and occupied,” and in a half-let center that number is small. A tenant’s share rises as the center empties. Nothing was remeasured. The formula simply did what it said, and the only representation about the 450,000 lived in a document the lease’s integration clause had superseded.
That is the same exposure as a remeasurement right, arriving by a different door. In Lexicon’s lease both doors are open: Paragraph 2(d) lets the landlord remeasure the Building, and Item 4 lets the landlord “allocate and prorate any portion or portions of the Operating Costs on a building-by-building basis,” in which case the share is recomputed as the ratio of premises to building. A tenant who negotiates the add-on factor and leaves the share definition alone has protected the smaller number.
I should be straight about the law here. Both cases are California Court of Appeal decisions, and I found the second inside the first rather than through a systematic search; my attempt at full-text search of the federal courts opinion collection returned a rate limit error and I did not complete it. Remeasurement disputes are structurally unlikely to produce reported opinions, because the whole point of a stipulated-area clause is that there is nothing to litigate, and because the amounts involved sit in the range where a tenant renegotiates instead of suing. Treat these two as illustrations of how courts treat square footage representations in one state, not as a survey.[12]
Is your rentable area a number or a right?#
The number is on the first page of every lease you own. Whether somebody can change it is on page eight, and it is two clauses, not one: who may remeasure, and what standard they must use.
Acrebase is built for exactly this kind of reading. It pulls the measurement provisions out of your executed leases into one view: the stated rentable area, the add-on or load factor if the lease discloses it, whether a remeasurement right exists, whether it is once-only or repeating, whether it reaches the renewal term, which standard is named and whether the lease says “or its successor,” and whether the proportionate share is stipulated as a percentage or defined as a live fraction. A portfolio where half the leases name Z65.1-2017 and the other half name “BOMA” with no year is a portfolio with an open position on the 2024 revision, and that is answerable in an afternoon rather than lease by lease. When your team drafts the next one, the approved clause library supplies the version your counsel signed off on, and the playbook carries the fallbacks in the order you actually trade them: one bite after substantial completion, then a cap on the adjustment, then nothing. Its AI reads how your earlier negotiations went, so when a landlord’s form arrives with a post-term remeasurement right, the flag comes with what your team got last time and what it gave up to get it. Related clauses we have covered: your base year is grossed up to 95% and then carved back down, the short fuse on CAM audit rights, and option to renew clauses don’t count negotiation as notice.
If you are a landlord, decide which of the two reasons you want the right for, because they call for different drafting. If the reason is that a space plan estimate is not a finished room, Design Therapeutics Section 4 is your clause: measure once after substantial completion, correct every figure that depends on the number, and say so. A tenant will sign that. If the reason is that you expect to find area under the 2024 standard and want the upside at renewal, say “ANSI/BOMA Z65.1 as amended or superseded” rather than naming the 2017 edition as a defined term and then using the defined term in the renewal sentence, which is what the Lexicon lease does. Disclose the add-on factor in the basic lease provisions the way Item 3 does; a tenant who was told 22% and signed has a much harder fraud argument than one who was told 25,368 and nothing else. And treat McClain as the floor, not the ceiling: a stipulated-area clause defeated the contract claim and the implied covenant claim, and lost to the tort, so the clause is worth having and will not protect a number you knew was wrong.
If you are a tenant, four things. Ask for the usable area and the factor as well as the rentable figure, and put all three in the lease, because you cannot audit a number whose inputs you were never given. Cap the right rather than fighting it to zero: one remeasurement, after substantial completion, with the calculations delivered to you, is a reasonable landlord ask and Lexicon actually got the delivery obligation for the expansion case and not for the renewal case. Watch the standard’s version and the words “or its successor,” since a remeasurement right under a standard that has not been written yet is an open-ended one. And remember that the renewal is the exposure, so if you only get one sentence, make it the Organogenesis sentence: the rentable area is not subject to remeasurement or adjustment, and extension term rent is not subject to modification if the actual size differs.
Footnotes
[1] Office Lease dated as of 30 July 2024 between RFL No. 4 Limited Partnership, a Delaware limited partnership, as landlord, and Lexicon Pharmaceuticals, Inc., as tenant, for Suite 1100, Research Forest Lakeside Building 4, 2445 Technology Forest Boulevard, The Woodlands, Texas 77381, filed as Exhibit 10.3 to Lexicon’s periodic report. Item 3 of the Basic Lease Provisions states Premises Size of 25,368 square feet of Rentable Area and Building Size of 286,575 square feet of Rentable Area, both “subject to verification upon the Commencement Date pursuant to Paragraph 2(d).” Item 4 gives Tenant’s Proportionate Share of Operating Costs as 8.85%. Item 5 gives Basic Annual Rent of $773,724.00 at $30.50 per square foot of Rentable Area per annum rising to $875,397.69 at $34.51. Item 8 gives the initial estimated proportionate share of Operating Costs as $25,981.06 per month for the 2024 calendar year, “i.e., $12.29 per square foot of Rentable Area per year.” Item 10 gives a Commencement Date of 1 September 2025 and Item 11 a Termination Date of 31 January 2031. The first and third sentences of Paragraph 2(d) are quoted in the body. The sentence between them, which carries the successor language the renewal sentence lacks, reads in full: “In the event of any expansions or contractions by Tenant (without implying any right to do so except as may otherwise expressly be provided in this Lease), the expansion space, or the contraction space will be remeasured and recalculated in accordance with such BOMA Standard, or its successor, or if the BOMA Standard is discontinued, in accordance with the then prevailing standard used for calculating rentable area of space in Comparable Building (as defined below). If the Building is remeasured as a result of such physical change, then Landlord shall provide Tenant with a copy of the calculations associated with such remeasurement.” The obligation to deliver the calculations is tied to a remeasurement caused by physical change, which is not the event the renewal sentence describes. “Comparable Building” is defined elsewhere in the lease and I have not pulled the definition. The proportionate share language at Paragraph 3 provides that where Operating Costs are allocated on a building-by-building basis the share is “based on the ratio of the Rentable Area of the Premises to the Rentable Area of the Building (which the parties stipulate to be 8.85% as of the date of this Lease)”: https://www.sec.gov/Archives/edgar/data/1062822/000106282224000046/exh103officelease.htm
[2] My arithmetic, not the lease’s. The lease discloses the two add-on factors and the resulting rentable figure and does not state a usable area or say how the factors combine. The compounding reading, 25,368 divided by 1.1074 and then by 1.1627, follows the two-step floor-then-building loading that Method A of the office standard describes, and yields 19,702 square feet usable. The additive reading, a combined 27.01% loading, yields 19,973. Neither figure appears in the document.
[3] On what the 2024 revision of the office standard changed: ground-level outdoor amenity areas, covered or uncovered, are included in rentable area where built as a tenant amenity, where the 2017 edition generally included them only if covered and under a single tenant’s exclusive use; tenant balconies and rooftop terraces are reclassified as Non-Allocated Tenant Area, measured at 100% with no load factor; occupant storage moves out of rentable exclusions into rentable area, unloaded; and Method B, the single load factor approach, was rewritten. I have not read ANSI/BOMA Z65.1-2024 itself, which is a paid publication, and BOMA’s own standards page returns 403 to this request. The description above comes from the two accounts cited at notes 4 and 5 and from Gensler’s summary: https://www.gensler.com/blog/boma-2024-office-building-measurements
[4] Stevenson Systems, “BOMA 2024: What Changed, From the Team That Helped Write It,” which states “3-4% average found rentable area in Class A properties” from the firm’s recent engagements and the capitalized value example quoted in the body. The firm says its people worked on the revision, so read the found-area range as a measurement vendor’s account of its own results and not as an independent survey. The arithmetic behind the $8 million is 400,000 times 3%, times $40, divided by 0.06: https://stevensonsystems.com/articles/boma-2024-what-changed
[5] iScano, “BOMA 2024 vs 2017: How to Increase Rentable Area,” a laser scanning vendor’s guide. Cited for what it is, which is the service being marketed by its title rather than any measurement finding: https://iscano.com/real-world-applications-laser-scanning-lidar/boma-2024-office-standard-rentable-area-guide/
[6] First Amendment to Lease entered into and effective as of 18 March 2022 between Crossing Holdings, LLC, a California limited liability company, as landlord, and Design Therapeutics, Inc., as tenant. Recital A recites an Original Lease dated as of 2 February 2021 covering approximately 12,371 rentable square feet in Suites 110, 115 and 150 at 6005 Hidden Valley Road, Carlsbad, California; Recital B adds approximately 4,900 rentable square feet in Suite 210, “subject to remeasurement.” Section 4 is quoted in full in the body. “Substantial Completion” and “Tenant’s Share” are defined in the Original Lease, which is not part of this exhibit, so the trigger date and the share mechanic cannot be read from this document: https://www.sec.gov/Archives/edgar/data/1807120/000095017022004311/dsgn-ex10_1.htm
[7] First Amendment to Lease made and entered into as of 14 June 2024 between HCP Oyster Point III LLC, a Delaware limited liability company, as landlord, and Tenaya Therapeutics, Inc., as tenant, successor-in-interest to The Column Group, LLC, under a Lease dated 6 September 2016 for approximately 32,370 rentable square feet on the fifth floor of 171 Oyster Point Boulevard, South San Francisco, California. Section 12 is quoted in full. Section 1.2 of the 2016 Lease, which held the deleted remeasurement right, is not filed, so the scope of what was deleted is not available: https://www.sec.gov/Archives/edgar/data/1858848/000095017024094059/tnya-ex10_1.htm
[8] Sublease Agreement dated for reference purposes only as of 18 March 2014 between Shire Holdings US AG, a Delaware corporation, as assignee of Shire Regenerative Medicine, Inc., formerly known as Advanced BioHealing, Inc., as sublandlord, and Organogenesis Inc., as subtenant. Section 1 states a Rentable Area of 69,265 rentable square feet, consisting of 56,489 for the Base Premises and 12,776 for Suite 600, and contains the quoted sentence. The document was filed four years after its date, as an exhibit to Organogenesis’s 2018 registration statement; the date in the body is the sublease’s own: https://www.sec.gov/Archives/edgar/data/1661181/000110465918072395/a18-41203_1ex10d9.htm
[9] McClain v. Octagon Plaza, LLC, 159 Cal. App. 4th 784 (31 January 2008). The facts in the body are the allegations of the first amended complaint, which the appellate court took as true for the purpose of reviewing a demurrer. The lease is dated 28 February 2003 for a term of five years two months with two five-year extension options. The $90,000 figure is the complaint’s allegation of total excess rent. The split between base rent and common expenses is mine: $3,804 less $3,535.10 is $268.90 a month, which over 62 months is $16,672, leaving the balance attributable to the four percentage point difference in the common expense share. The court affirmed dismissal of the implied covenant claim and of the claim under the Consumer Credit Reporting Agencies Act, and reversed on misrepresentation and on the accounting. The lease also contained, at paragraph 2.4, the companion acknowledgment that tends to travel with a stipulated-area clause: “Lessee acknowledges that: (a) it has been advised by Lessor … to satisfy itself with respect to the condition of the Premises … , and their suitability for Lessee’s intended use, [and] (b) Lessee had made such investigation as its deems necessary with reference to such matters and assumes all responsibility therefor as the same relate to its occupancy of the Premises ….” The court treated that clause as going to the condition of the premises rather than to their size, and held in any event that such acknowledgments do not bar fraud claims. The text here is from the Caselaw Access Project mirror, which is optical character recognition of the printed reporter; the reporter’s own text at this point reproduces the lease’s ellipses and bracketed insertions, including the grammatical error in “as its deems necessary”: https://static.case.law/cal-app-4th/159/cases/0784-01.json
[10] Furla v. Jon Douglas Co., 65 Cal. App. 4th 1069, 1080 (1998), quoted in McClain. The passage in McClain also records the court’s reasoning that “approximate” includes “near to; about; a little more or less; close,” and that the alleged error “was not de minimis, and cannot be ignored.” McClain’s own discrepancies, 7.6% of the unit and 8.15% of the center, were smaller than Furla’s and the court held they still could not be treated as de minimis as a matter of law.
[11] Thrifty Payless, Inc. v. The Americana at Brand, LLC, 218 Cal. App. 4th 1230 (19 July 2013), review denied 23 October 2013, S212974. Again a demurrer, so the figures are allegations. The CAM budget letter from the landlord’s parent company’s vice-president of leasing and acquisitions, sent on or about 1 September 2004, stated the participating square footage as 450,000 of gross leasable area and Thrifty’s resulting share as 2.2%, and carried the warning that “the costs reflected are purely estimated values.” The lease was executed on or about 22 February 2005 and amended on or about 6 November 2008; 2009 was the first full year charges ran. The pro rata share definition at paragraph 6.8.1 and the Other Stores carve-out at paragraph 6.8 are quoted in the body from the opinion’s own footnote. The three 2009 charges the complaint compared were taxes of $169,686 against $43,836 at the letter of intent rate, insurance of $28,110 against $11,689.60, and common area maintenance of $412,307 against $211,874. The letter of intent dated 17 February 2004 had estimated annual real property taxes at $3 per square foot and first-year insurance at 80 cents per square foot. The minimum rent commencement date under the lease was 2 May 2008, so the gap between the estimate and the first full year of charges was about five years, during which the center was built and let. The opinion does not say what the center’s actual leased and occupied floor area was in 2009, only that Thrifty’s resulting share was 5.67%: https://static.case.law/cal-app-4th/218/cases/1230-01.json
[12] On the absence of remeasurement case law: I attempted a full-text search of the govinfo United States Courts Opinions collection for remeasurement and load factor terms and the API returned a rate limit response rather than results, so that search was not completed and is not the basis for any statement here. The two decisions above were located by citation, the second through the first. Disputes of this kind would concentrate in state trial courts and unpublished decisions I did not search, and the structural reason there is little reported law is that a stipulated-area clause is designed to leave nothing to try.
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