It's critical to keep up with legislative requirements and limits as a commercial real estate investor or property owner in California, as they may have an impact on your business operations and investment decisions. The following are five main limitations on Californian business real estate laws that you should be aware of:

Zoning and Land Use Restrictions

In 1908, California became the birthplace of zoning. State laws determine how commercial properties can be used, sometimes even dictating which types of retail operations are permitted. As a property owner, you need to understand zoning and land use laws to avoid renting to a business that cannot legally operate at the location without obtaining a rezoning approval first.

Rent Control Exemption for Commercial Properties

In California, commercial real estate is typically exempt from rent control legislation, in contrast to residential properties. This implies that, provided the terms are spelled out in detail in the lease agreement, landlords have greater flexibility in determining and modifying the rental rates for business tenants.

Parking Requirements (AB 2097)

Effective January 1, 2023, Assembly Bill 2097 forbids public agencies from enforcing minimum parking requirements on any development project, including commercial projects that are not for residential use, that is situated within a half-mile of a major transit stop. This ordinance seeks to lessen the excess of parking spots and promote transit-oriented development.

Environmental Disclosure Requirements

Commercial property owners and sellers are required by California's strict environmental disclosure rules to report any known environmental concerns or contaminants on the property. This covers the existence of hazardous materials such as paint containing lead, asbestos, or subterranean storage tanks. There may be legal repercussions if such material is not properly disclosed.

Subleasing the Property

California law requires commercial tenants to obtain landlord consent before subletting or assigning their lease to another party. However, landlords cannot unreasonably withhold this consent. If refusing a sublease request, landlords must provide valid reasons outlined in the lease, such as concerns over the proposed subtenant's financials or intended use. Mere desire to prevent subletting is not considered a valid reason under the law. This requirement holds landlords accountable and prevents arbitrary denial of reasonable subletting requests from tenants.

It's crucial to remember that there are several laws and rules that control commercial real estate in California; here are just a few examples. It's important for investors and property owners to speak with knowledgeable legal experts who can offer advice tailored to their particular circumstances and guarantee adherence to all relevant rules and laws.

You may reduce hazards, steer clear of expensive fines, and make wise decisions that safeguard your commercial real estate assets and business interests in California by being aware of these regulatory requirements and taking proactive measures to comply with them. If you need more assistance with your commercial real estate ventures, reach out to us at info@cbicommercial.com or 310-943-8530.