A Tariff Enacted After Your Construction Contract Becomes Sixteen Years of Base Rent
The word Tariffs appears exactly once in Reata Pharmaceuticals' 15 October 2019 build-to-suit lease with TC Legacy Land Venture for 327,400 square feet in Plano, Texas, and it is not in the force majeure clause. It is in Section 5(b), where a duty enacted after the construction contract is signed raises Total Project Costs, lifts the $13,344,000 Maximum Base Rent at a 0.0760 Yield Constant, and then escalates 1.95% a year for a sixteen year term. Each dollar of tariff above the unspent contingency costs about $1.39 in rent. The same lease's force majeure definition says means only and lists material shortages and governmental moratoria, so the landlord gets time for a shortage and nobody gets time for a duty. Green Dot's Pasadena lease, ConforMIS's Billerica lease and a BioMed Realty form from San Diego draw the delay list three different widths, and none of the four carves out cost increases in so many words.