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Tenant must pay sublease profits to landlord but may deduct fixturing period rent as reasonable costs.
The plaintiff landlord and defendant tenant both brought motions for summary judgment regarding the interpretation of a commercial lease.
The landlord claimed the tenant owed over $2 million in profits from three subleases, while the tenant argued it incurred losses after deducting reasonable costs.
The court held that the tenant could not deduct rent paid for retained Atrium space as a reasonable cost of the subleases.
However, the court found that rent lost during rent-free fixturing periods, as well as legal fees and real estate commissions, were reasonable costs that could be deducted from the sublease profits.
