U.S. Commercial Real Estate for Operational Companies

This article was originally published on Funder in April 2026.

Commercial lease agreements in the United States frequently expose foreign founders to risks they neither anticipated nor priced. A recurring example manifests in litigation surrounding Personal Guarantees. U.S. courts consistently enforce guarantees signed by foreign founders who mistakenly assumed such obligations were merely symbolic, temporary, or negotiable post factum. In numerous published opinions, courts have rejected defenses based on business hardship or a “change of circumstances,” emphasizing that commercial guarantors are presumed to understand the legal instruments they execute.

Environmental liability provides another striking illustration. Under U.S. law, a tenant may be held liable for environmental remediation without having personally caused the contamination, including for conditions that predated the lease. This principle is repeatedly enforced under federal and state environmental statutes, often catching foreign tenants off guard, as the law is predicated on the assumption of sophisticated parties engaging in adversarial, arm’s-length negotiations.

Israeli executives, accustomed to more flexible landlord-tenant dynamics, are often startled to discover that American landlords may accelerate years of future rent, pursue guarantors personally, and aggressively enforce default remedies. Courts enforce these provisions strictly as written; there is no “safety valve” for perceived transactional unfairness between sophisticated parties.

The takeaway is not that American landlords are predatory, but rather that U.S. real estate law assumes adversarial sophistication. Companies that treat leases as a mere administrative necessity, rather than a strategic commitment, often discover their exposure only when it is too late.

Michael Ehrenstein is a Founding Partner at the American law firm Ehrenstein|Sager, specializing in commercial law, complex litigation, and high-stakes international arbitration.

Legal Disclaimer: This article does not constitute legal or tax advice. Its purpose is to raise awareness regarding U.S. compliance issues. Israeli businesses should consult with qualified U.S. legal and tax professionals to obtain advice tailored to their specific operations