Expert: Stephen A. Cross, CCIM - 3/11/2011

Question
If a Tenant is in breach of a commercial lease (for not paying rent due), does the Landlord have the right to retain the security deposit in its entirety? Or, can the rent due be credited to the deposit? Basically, how and under what circumstances does the return of the security deposit work in commercial leases in the state of FL?

Answer
While I am unfamiliar with Florida statutes, the non-payment of rent generally triggers a monetary default. In the event of such a default the security deposit could be used to offset rental amounts due, including the landlord's legal expenses. Of note is that the security deposit should not be considered to be the pre-payment of the last month's rent. Rather, it represents money the landlord can use to restore the premises in the event the space was damaged (above normal wear and tear) by the tenant upon the expiration of the lease.