Are Your Rental Agreements Signed? The Importance of Regular Lease Audits

It seems like the only time a tenant’s file is checked to verify that they have a signed lease is when that tenant goes into lien. By that point, it’s a little late to be discussing how a tenant was able to access the facility and move its contents into a space without actually signing a lease.

But if you are an operator that has dealt with this situation, don’t worry. You are not alone. In fact, there has been an increase in situations like this where tenants are able to access and secure a storage unit without ever having to finalize their move in process, including the requirement to execute a rental agreement.

Judges and arbitrators are often reluctant to confirm the rights and protections granted a self-storage business operator against its tenants without the presentation of a signed lease.

First, if this is happening at your facility, you must review your rental process to determine how this is happening. Whatever the cause, the gap in the process must be fixed so that, in no uncertain terms, a tenant must execute (electronic signature is fine) a rental agreement before taking occupancy of a rented space.

Self-storage facilities can be busy places and owners and managers are often distracted by marketing, selling and maintaining the operation of their business. But one of the most important and vital pieces of a self-storage business is the confirmation of the rights and responsibilities of the owner and tenant through the initial execution of the parties’ rental agreement. Don’t wait until it’s too late before conducting your lease audits.

This article was originally published in Self Storage Legal Monthly Minute by Scott Zucker, January 2024

Scott Zucker is a founding partner in the Atlanta law firm of Weissmann Zucker Euster Morochnik & Garber P.C. and has been practicing law since 1987. Scott represents self-storage owners and managers throughout the country on legal matters including property development, facility construction, lease preparation, employment policies and tenant claims defense. He also provides, on a consulting basis, advice to self-storage companies in the areas of foreclosure and lien sales, premises liability and loss control safeguards. Scott can be reached at 404-364-4626 or by e-mail at Scott@wzlegal.com.