How to Structure Leases Around Entitlement Timelines

ASK:

How do I protect both my tenant and myself when entitlements might take months or longer?

ANSWER:

The fastest way to lose a tenant’s trust is to overpromise on timing. Entitlements are unpredictable, and most tenants underestimate how long they take.

At I&D Consulting, we help developers structure leases and agreements that build in flexibility, accountability, and transparency so no one gets blindsided.

The Reality of Timing

Most tenants think “permits” when they hear “approvals.” But entitlements come first, and they can stretch 6 to 12 months, sometimes more. Without accounting for that in the lease, both sides are exposed:

The tenant is stuck waiting, unable to plan operations.
The developer burns through carrying costs without certainty.

How We Structure Around Risk

Define Entitlement Milestones
Use specific language: planning approval, building permit issuance, certificate of occupancy. Tie each to clear timelines.
Use Trigger Dates, Not Hard Dates
Replace “Tenant opens by June 1” with “Tenant opens within 120 days of permit issuance.” This keeps timelines realistic and reduces disputes.
Include Termination and Extension Options
Build in off-ramps for delays beyond either party’s control. If entitlements extend past a threshold, both sides can decide whether to continue or part ways cleanly.
Share Progress Transparently
We integrate status reports and milestone tracking, so everyone sees exactly where the project stands.

Why This Builds Trust

Transparency creates confidence. When the tenant understands the process, they stop seeing the developer as “slow” and start seeing them as “strategic.”

KEY TAKEAWAYS:

Entitlement timelines must be reflected in your lease language.
Use trigger dates and milestones to manage risk.
Transparency turns potential tension into long-term trust.