REM - Real Estate Management Real Estate Law and Risk Questions and Answers

Question 1

A real estate manager is drafting a lease for a new commercial tenant.
To minimize future disputes and ensure legal enforceability, which of the following is the MOST critical element to include in the agreement?

Accepted Answer

A detailed description of the property, rent amount, lease term, and responsibilities for maintenance.

Answer

A clause requiring the tenant to use a specific cleaning vendor.

Answer

A list of preferred paint colors for the interior space.

Answer

An automatic renewal clause that extends the lease by five years.

Question 2

A prospective tenant with a disability requests the installation of a ramp at the main entrance of a retail property built in 2005. Under the Americans with Disabilities Act (ADA), what is the property manager's primary obligation?

Accepted Answer

To evaluate if the request is a "readily achievable" barrier removal and make reasonable modifications.

Answer

To deny the request as the building was constructed before the most recent ADA standards.

Answer

To install the ramp immediately at the property owner's full expense.

Answer

To inform the tenant they are responsible for all costs associated with the modification.

Question 3

A property manager discovers potential soil contamination from a previous tenant's operations. What is the most appropriate initial step to manage this environmental risk?

Accepted Answer

Commission a Phase I Environmental Site Assessment (ESA).

Answer

Ignore the issue unless a government agency sends a notice.

Answer

Immediately begin excavation and removal of the suspected soil.

Answer

Offer the next tenant a discount on rent to accept the property 'as-is'.

Question 4

Which type of insurance policy would best protect a real estate management company from a lawsuit filed by a property owner alleging financial loss due to the manager's failure to properly screen tenants?

Accepted Answer

Professional Liability (Errors & Omissions) Insurance

Answer

Commercial Property Insurance

Answer

General Liability Insurance

Answer

Workers' Compensation Insurance

Question 5

During the eviction process for non-payment of rent, a property manager is tempted to change the locks and shut off the utilities to expedite the tenant's departure. This practice is known as:

Accepted Answer

A self-help eviction

Answer

Constructive eviction

Answer

A lawful detainer action

Answer

A summary proceeding

Question 6

To mitigate risks associated with on-site employees and maintenance staff, a real estate management company is legally required to carry which type of insurance?

Accepted Answer

Workers' Compensation Insurance

Answer

Cyber Liability Insurance

Answer

Tenant Discrimination Insurance

Answer

Commercial Auto Insurance

A real estate manager is drafting a lease for a new commercial tenant.To minimize future disputes and ensure legal enforceability, which of the following is the MOST critical element to include in the agreement?

A real estate manager is drafting a lease for a new commercial tenant.
To minimize future disputes and ensure legal enforceability, which of the following is the MOST critical element to include in the agreement?