Property Management
In New Mexico, when a commercial tenant exercises a lease renewal option, the new lease term and rent are determined by:
AWhatever the landlord decides
BThe terms specified in the original lease option clause✓ Correct
CCurrent market conditions always
DThe county assessor's office
Explanation
Lease renewal options specify how the new term's rent will be determined—fixed rate, market rate, CPI adjustment, or other formula. The option terms are binding on both parties once the option is properly exercised.
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