Free SB 1103 Compliance Checker

SB 1103 is a California statute that requires landlords of commercial properties to provide detailed operating expense disclosures to qualifying tenants. It affects landlords with NNN or modified gross leases in California who pass through operating expenses. Qualifying tenants have the right to request itemized expense breakdowns and supporting documentation.

SB 1103 requires landlords to provide itemized statements of operating expenses, including the methodology used for allocating shared costs, the basis for pro-rata share calculations, and documentation supporting each expense category. Landlords must respond to tenant requests within a specified timeframe and maintain records for a defined retention period.

Landlords must provide annual operating expense statements within 120 days after the end of the calendar year. When a qualifying tenant requests supporting documentation, the landlord has 30 days to respond. Failure to meet these deadlines can expose landlords to penalties and give tenants grounds to dispute billings.

SB 1103 protections apply to commercial tenants in California who occupy space under leases that include operating expense pass-throughs. The statute covers tenants in office, retail, and industrial properties. The specific qualifying criteria relate to the lease structure rather than the tenant size or industry.

Non-compliance can result in tenants withholding operating expense payments until proper disclosures are provided, monetary penalties, and increased audit exposure. Courts may also award attorney fees to tenants who prevail in SB 1103 disputes. Getting compliant early costs less than defending a dispute later.