Don't Automatically Agree to Termination for Low Gross Sales

It’s preferable to not give a tenant a “performance kickout right”—that is, a right to terminate the lease if its gross sales during a certain period fall below or don’t reach a certain dollar amount. That’s because terminated leases don’t generate rental income and may reduce the value of your center as far as lenders are concerned. Also, you may wind up with dark space for a while if you can’t find a tenant.

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