Tenant Doesn't Have to Pay Tax Increase on Improvements that Benefit Only Landlord

What Happened: A lease required the tenant that would occupy 45 percent of the space in a four-story building to pay 42.98 percent of the taxes on the property. The agreement contained a tax escalation clause requiring the tenant to pay the proportionate share of tax increases on the building. The landlord later added seven floors of new residential space, turning the premises into an 11-story mixed-use building carrying a much higher tax.