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cally granted periods of free rent as concessions to lessees. At
the time the lease agreement was executed, the inclusion of such
rent holidays in commercial leases like the lease agreement
involved here was one type of concession offered by lessors that
was a reasonable and acceptable practice in the Denver office
market (and throughout the commercial real estate industry),
irrespective of whether the lessees under such leases intended to
occupy the leased space or to sublease it to others. Although
Marshall and Stevens expected the practice of including rent
holidays in commercial leases to continue for a few years after
June 1988, it anticipated that the Denver office market would
tighten during those years, with the result that rental rates
would increase, vacancy rates would decrease, and fewer lease
concessions would be granted to lessees by lessors.
At the time Partnership and BCE entered into the lease
agreement, it was a reasonable and acceptable practice throughout
the commercial real estate industry, including the Denver office
market, to offer rent holidays in long-term commercial leases
such as the lease agreement involved here in order to induce the
lessee/sublessor to agree to assume the risk of subleasing the
unleased, vacant space to others.7 Specifically, in June 1988,
when the lease agreement was executed, it was consistent with
7 The typical periods of free rent being offered in the Denver
office market at the time the lease agreement was executed were 6
months on 5-year leases and 12 months on 10-year leases.
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