Property Management
What is an 'escalation clause' in a Hawaii commercial lease?
AA. A clause allowing the tenant to terminate the lease if rent increases
BB. A provision that automatically increases rent at specified intervals, often tied to CPI or a fixed percentage✓ Correct
CC. A clause allowing the landlord to terminate the lease early
DD. A provision requiring the tenant to pay for property improvements
Explanation
An escalation clause provides for automatic rent increases over the lease term, tied to the Consumer Price Index (CPI), a fixed percentage, or other benchmarks.
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