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Concealed carry = lease leverage?

By: Jack Zemlicka, [email protected]//July 15, 2011//

Concealed carry = lease leverage?

By: Jack Zemlicka, [email protected]//July 15, 2011//

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(WLJ Photo by Kevin Harnack)

Wisconsin’s legalization of carrying concealed weapons could lead to more businesses pulling the trigger on commercial leases.

While developers and property owners are figuring out what the new law means for their properties, prospective tenants can use the law, which goes into effect in November, as a bargaining chip in lease negotiations, said commercial real estate lawyer Scott Langlois, of Quarles & Brady LLP, Milwaukee.

“Right now, landlords are doing what it takes to get tenants in their buildings,” he said. “So if a tenant requests that something be in the lease that the buildings have signage restricting concealed carry, I think most landlords would agree to that.”

The law, signed by Gov. Scott Walker on July 8, lets people who obtain a permit and go through training carry concealed weapons in most public buildings, including the state Capitol and city halls, unless a sign is posted saying otherwise.

But the law gives liability immunity to any person or employer who allows concealed carry on their property. Those who post signs restricting concealed carry on the property don’t have the same liability exemption.

“Part of the statute offers the incentive to do nothing,” Madison commercial litigator Jessica Ozalp said.

Still, Ozalp said, her business clients only have asked about what they need to do to prevent guns on their property.

“I haven’t heard anybody call,” she said, “and say they are happy that they can allow guns on their property.”

Rick Barrett, master developer for the Moderne mixed-use development in downtown Milwaukee, said he wasn’t sure what the gun policy would be for the $55 million structure, scheduled for completion in late 2012. The 30-story project is seven months into its 22-month build, he said, and will have 203 apartments, 14 top-floor condominium units and 8,000 square feet of retail space on the ground floor.

Barrett acknowledged the new law “may make a big difference in how buildings are handled.”

One of the business considerations in determining a concealed-carry policy is whether it will convey a pro- or anti-concealed-carry standard, Barrett said.

While he declined to speculate on the best method, Barrett said the thought of allowing concealed carry in a business “may startle tenants.”

“I think at some point, we’ll need to ask those questions,” he said of the best practice to accommodate businesses and residents.

Some commercial property managers already are asking those questions.

Janet Menz, property manager for the 100,000-square-foot Barnabas Business Center in Glendale, recently met with tenant safety managers to come up with a plan.

“The initial discussion,” she said, “is that there would be some sort of building guideline drafted to indicate no concealed carry allowed in the building.”

Menz said it was too early to tell whether banning guns inside the business center would be an attraction for prospective tenants. However, she said, any adopted building guidelines would be part of a tenant’s lease.

The 23-year-old business park is home to 15 commercial tenants and has about 19,000 square feet of available space, said Menz, who works for Milwaukee-based Barnabas Property Barnabas Building Properties LLC.

Some property owners and managers leave the decision up to individual tenants.

“Unless there is some sort of moral or political objection, it’s really our tenant’s responsibility, and we will let them make their own decisions,” said Sheldon Oppermann, vice president of Madison-based Compass Properties LLC.

Compass manages or owns about 1 million square feet of commercial space in Wisconsin.

Oppermann said he didn’t see any advantage for tenants with the new law and said businesses wouldn’t surrender a chance to lease prime real estate just because of an owner’s concealed-carry policy.

“I can’t imagine a business owner making a decision not to locate in the best possible space merely because they’d like to permit their employees to carry firearms inside the building,” he said.

But Langlois argued commercial clients still have plenty of vacant space and the flexibility of either allowing or prohibiting guns could fill those empty chambers in a building.

“Right now, owners are being very accommodating,” he said. “This could be another way to do that.”

Jack Zemlicka can be reached at [email protected].

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