November 2022

the detroit

You Can Go Home Again

  • I was up in Metro Detroit over Thanksgiving and had an opportunity to drive around to see the continued progress there.
  • COVID was tough on the City, but it has survived and is still thriving.
  • There are a lot of interesting developments going on all over the City.

I hope everyone reading this had a fantastic Thanksgiving with family and friends. Its such a great time to relax and enjoy being with the folks you care about. And in my world, it was capped off by a FANTASTIC Michigan win over Ohio State. And even the Lions played well.

I did spend the holiday up in Michigan, which is where I am from. And when I got there on Tuesday, I had the opportunity to drive around Detroit and take stock of what changes have been made.

So this week I’m going to write a little about what is going on in Detroit since the last time I gave an update. And hopefully it will inspire you to take notice, go visit, or even invest.

COVID was Difficult in Detroit


One of COVID’s everlasting legacies (I think) is that, if you were not on good, firm, stable ground prior to COVID, the hard times brought about were especially daunting. And could cause a lot of entities to crumble.

Detroit is certainly on the road to recovery from a disastrous stretch in the 1970s, 80s, and 90s. There is a lot more activity downtown and people seem to be moving back to the City. But its certainly not as solidified as Central Texas, for example. As a result, COVID was very difficult and slowed Detroit’s renaissance.

This is purely anecdotal, but some business partners and I have an investment in a small apartment community in Detroit. During COVID, construction shut down for almost six months. And then when it came back, there was incredible demand for the contractors. As a result, it was extremely difficult to get any construction done in the City. And it was expensive.

But despite that, growth appears to be continuing. In 2022, average home prices went up about 38% from the previous year. In addition, since 2012, Metro Detroit saw the second-highest growth among peer cities for people between the ages of 24 and 35. So despite having some struggles with COVID, there are still big things happening in Detroit.

There are a Lot of New Developments in Detroit


And when a city has growth like Detroit has seen, new development is soon to follow. When I was driving around last week, I could not help but be impressed by the Wayne State University area, for example. WSU has approximately 23,000 students and has really seen growth and tremendous revitalization in the area.


In addition to the Wayne State area, here are a few more developments that are in the works:

  • Detroit Central Station – As you can see, Ford has made considerable progress in its revitalization of the long dormant train station. It plans to open it in 2023.

train station

  • Fort Pontchatrain Hotel – The owners plan to build a second tower to the classic hotel.
  • Fisher Body Plant – Investors are planning to turn the old car factory building into 200+ loft apartments with ground floor retail.
  • 200 Walker Street – No list of new developments in Detroit can be complete without something from Dan Gilbert. His company recently bought this location and plans to turn it into a mixed use development.
  • Motown Museum – Money has been raised to expand the Motown Museum and make it into more of a tourist attraction.

Motown Museum

Obviously there are a lot more developments going on in Detroit. These are just a few of the highlights. There are a lot of good things happening there. And hopefully it will continue as Detroit continues to surge. And if you want to make a trip up there to check it out … first, wait until spring. Then give me a call and lets talk about it.



You Can Go Home Again Read More »


Do Not Assume Your Tenant Will Not Sublease the Property

  • Under a sublease, the original tenant is still bound to the landlord for all its obligations under the original lease.
  • Under an assumption, the new tenant steps into the shoes of the original tenant and assumes all the rights and obligations under the original lease.
  • It is very important for commercial real estate property owners to make sure they are protected by the terms of a lease.

First things first – by the time you read this, it will likely be Thanksgiving or just before. So I hope you are all looking forward to a great time with your friends and family. I know I am.

But first – a little business. This week I want to write about an issue that not only have we dealt with recently at Bukowski Law Firm, but its also relevant to a commercial real estate development here in Austin.

I am, of course, talking about subleases and assumptions of leases. If you are a commercial real estate developer, you have to make sure that your lease protects your rights as the landlord. And that includes having clear guidelines for subleases and assumptions. So that’s what we will talk about this week.

Subleases do not Release Original Tenant


You undoubtedly read recently that – after leasing 589,000 square feet of office space in a new tower in downtown Austin just eleven months ago – Meta has decided it no longer needs all of that space. According to the article in the ABJ, therefore, Meta is looking into subleasing that space.

The key to a sublease is that it does not relieve the original tenant from its obligations under the lease. If party X has a lease with a landlord, party X may want to get rid of some of the space it has. It may be able to sublease some of that space to party Z.

But under a sublease agreement, party X is not relieved of its obligations to the landlord. It still has to pay rent to the landlord and it is still responsible for the other obligations under the original lease. That lease is still in place. The only difference is now it has a subleaser – party Z – that is liable to it (party X).

But if party Z does not pay party X for rent under the sublease, party X is still liable to the landlord for the rent in the original lease. And if party X does not pay the landlord, the landlord can evict and sue, regardless of what party Z did or did not do.

Assumptions do Release Original Tenant


In contrast to a sublease, an assumption of a lease completely relieves the original tenant of its obligations under the original lease. The party that is assuming the lease steps into the shoes of the original tenant. And it assumes all of the obligations under the original lease.

If party Z, therefore, assumed the lease from party X, party Z would pay rent directly to the landlord. Party X would no longer be involved in the transaction and have no more rights or obligations under the original lease. If the landlord does not receive its monthly rent, its recourse would be against party Z – not party X.

Commercial Landlords Need to be Protected


As a commercial landlord, it is essential to make sure the rights of your tenant to sublease and/or do an assumption of the lease are clear. That should be explicitly spelled out in the original lease.

For our clients, we recommend not allowing tenants to sublease or have an assumption without the express written consent of the landlord. And the landlord can withhold that consent for whatever reason it chooses, or no reason at all. This is important because you do not know what kind of subtenant the original tenant will bring to you. As a result, you need the possibility of being able to reject the new tenant if it does not meet your standards.

By doing this, you can make sure you are protected as a property owner and when someone like Meta wants to back out of a lease agreement, it is still responsible for the rent.

Do Not Assume Your Tenant Will Not Sublease the Property Read More »

to do list

Why Put Off to Tomorrow What You Can do Today?

  • We are officially into holiday season 2022 – next week is Thanksgiving.
  • Aggressive and smart investors can often find good opportunities in uncertain economic times like we are currently in.
  • So lets use these remaining six weeks of the year to get a great start on 2023.

I think we are officially in the end of year holiday season. Thanksgiving is next week. One of the groups I belong to had its holiday party last week. And Hallmark Christmas movies are in full swing.*

And while visions of turkey and stuffing danced in my head, I really started to think this week about the dangers that this dreaming can cause. Its what I call a kind of holiday malaise at work and it can present a real problem. So much so that, at our weekly meeting, we talked about not letting holidays interfere with our mindset at work in the next six weeks.

Luckily, I have a great team here at Bukowski Law Firm. So while we are all looking forward to celebrating the holidays with our friends and families, when at the office, we are focused on work. And won’t let our anticipation get in the way of serving our clients. And that’s what I want to write about this week in the blog – maintaining focus for these last six weeks of the year. And not letting them go to waste.

Where is the Commercial Real Estate Market?


We have about six weeks left in 2022. And that’s a long time. But, as I am sure you know, its so easy to see that time just get wasted. Its why – even though I love the holiday season, it can be very frustrating.

And I worry that may be especially true this year because there is so much uncertainty in the market. I have heard from a lot of people that they are not out looking at acquisitions, developments, etc. right now because of that uncertainty. That is, obviously, completely understandable. With rising interest rates, large layoffs, the potential for a recession – its murky out there. And the cap rates in the market may not yet fully reflect the changing conditions.

But with uncertainty brings potential opportunity. Assuming things go as expected, there will likely be lots of opportunities in the near future with distressed assets. Whether that’s providing third party lending or buying notes or acquiring property – all of those opportunities are likely to be there. And the time to kick the tires and see what is available is now. There are likely to be a lot of investors in the market looking to acquire distressed assets. So the sooner you are out there pounding the pavement and looking for your own investments, the better off you will be. If you put it off for these six weeks and wait until next year, it may very well be too late.

Also, we are not tax lawyers, but getting a deal closed before the end of the year can potentially provide tax benefits. This is between you and your tax accountant but if you have an opportunity to take a gain or loss this year, it may be beneficial versus waiting until next year.

So what are we saying here? Obviously you know your business a lot better than I do. But it just pains me to see people throw away the last six weeks of the year because of holiday malaise. So check with your accountant, check with your broker, and check with your team to keep these last six weeks busy. And get the start on a fantastic 2023.


** If you need any recommendations, let me know. I’ve seen a few.

Why Put Off to Tomorrow What You Can do Today? Read More »


Oh the Tangled Web We Weave

  • Litigation often increases in times of economic uncertainty.
  • One potential tool for a plaintiff that has been treated unfairly by a defendant is to sue under the Texas Deceptive Trade Practices Act.
  • The DTPA can help real estate owners if they have been harmed by builders, vendors, etc.

We have gotten kind of busy here at Bukowski Law Firm the last month or so with some incoming litigation. I mean, we always have a steady stream of it. It just seems like we have seen an uptick in litigation recently.

This probably is not a surprise. Litigation, unfortunately, always seems to rise when there is uncertainty in the economy. And as we are headed into a more uncertain future, I reckon we may see even more of it in 2023.

This week, therefore, I want to write about a tool you may not know about if you are facing some unwelcome litigation. The Texas Deceptive Trade Practices Act (“DTPA”) can provide Plaintiffs an important tool to use against a disingenuous vendor.

What is the DTPA?


Texas has enacted a consumer protection law called the Deceptive Trade Practices Act. It was set up to protect consumers from unscrupulous businesses that attempt to lie and deceive. And it can be a great tool for plaintiffs in a lawsuit.

At first glance, this may seem like a strange topic for me to write about. We are not, after all, a consumer protection law firm. We are a real estate firm. The key, though, is that the DTPA protects all consumers of goods and services. And real estate companies sometimes fall into these categories.

Specifically, consumers are defined as any individual, partnership, corporation, or governmental entity who seeks to acquire any goods or services. So as long as you are purchasing or leasing goods or services, therefore, you are likely to qualify as a consumer and be able to avail yourself of the DTPA’s protections. It does not matter what the good or service is nor whether you are an entity. You are still a consumer for DTPA purposes.

What do You Need to Show for DTPA?


If you are a consumer, therefore, and you have been deceived when purchasing goods or services, you can potentially sue under the DTPA. Before you file a lawsuit, however, you are required to send to potential defendants a 60 day notice. This gives the parties two months to try to reach a settlement before litigation.

Once you do file a suit, to prevail a plaintiff needs to show that the defendant acted in a false, deceptive, or misleading manner. And the statute gives a lot of examples of what that entails.

For example, false, misleading, or deceptive acts or practices includes but are not limited to:

  • Representing that the goods or services are of a particular standard, quality, or grade, or that the goods are of a particular style or model, if they are another;
  • Representing that an agreement confers or involves rights, remedies, or obligations which it does not have or involve, or which is prohibited by law; and
  • Knowingly making false or misleading statements of fact concerning the need for parts, replacement, or repair services.

There are a lot of other examples given in the DTPA – these are just a few examples. And, as a benefit to the bringing the claim, the plaintiff does not normally have to prove intent to deceive, unless the specific clause requires it (as #3 does above). This makes the plaintiff’s hurdle to prove liability much lower.

But if the plaintiff can prove that the defendant knowingly or intentionally was deceptive, the plaintiff can seek additional damages – up to three times the total loss.

DTPA for Real Estate Claims


As I mentioned above, we are not a consumer protection law firm. But we are a real estate litigation firm (among other real estate services). As a result, we are able to use the DTPA on behalf of our clients. In the past we have used it for homeowners against builders, commercial property owners against vendors, etc.

If you are facing the unfortunate prospect of real estate litigation, therefore, the DTPA can be a very effective tool for seeking redress for your loss.

Oh the Tangled Web We Weave Read More »