Property Management
A Texas commercial tenant is a 'percentage tenant' under a lease where rent varies with sales. The landlord typically has the right to:
ANo verification rights for tenant's sales
BAudit the tenant's sales records periodically to verify that percentage rent is being calculated correctly✓ Correct
COnly accept the tenant's word for sales amounts
DSet the sales reporting period without the tenant's agreement
Explanation
In a percentage lease, the landlord has an important financial interest in accurate sales reporting. Leases typically include provisions allowing the landlord to audit the tenant's sales records. Tenants must maintain accurate records and submit sales reports per the lease terms. Audit rights protect the landlord from underpayment of percentage rent.
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