Plugging Loopholes

Make Kick-Out Right Dependent on Gross Sales Plus Online Sales

March 12, 2015    

It’s common for retail tenants to negotiate a kick-out right—that is, the right to terminate the lease in the first few years if its gross sales fall below or don’t reach a certain threshold. This right is especially important for tenants that are considering expanding into a...

Get Option to Terminate Lease If Affiliate Severs Ties with Tenant

September 29, 2014    

You may have to give in if a strong tenant demands the lease right to assign or sublet to its affiliate—that is, a company the tenant controls or that controls the tenant—without your consent. The tenant probably will argue that an assignment or a sublet to its affiliate is no big...

Include Two Protections in Eminent Domain Clause

August 26, 2014    

Some tenants that turn out not to be able to afford the rent for their space are upfront with their owners and try to deal with the situation the best way they can. Unfortunately, you may someday be faced with a tenant that must move out of its space before the end of its lease, but tries to get...

Don't Let Bankrupt Tenant Prorate Last Month's Rent

August 13, 2014    

It’s typical for commercial leases to allow tenants to prorate rent if certain events, such as destruction of the tenant’s space, occur. But when you agreed to rent proration, you probably didn’t intend to let a bankrupt tenant that decides to reject its lease prorate its last...

Include Eight Protections in Holdover Clause

July 25, 2014    

If you haven’t negotiated a favorable holdover clause in your lease with a tenant, you may end up getting stuck with low rent and high costs if it won’t move out of the space when its lease term is over. That’s because to get rid of a tenant that doesn’t move out when its...

Require Tenants to Conform to New Signage Criteria

April 10, 2014    

In the excitement and administrative hustle and bustle of redeveloping their centers, some owners discover they’ve overlooked one very important aspect of the redevelopment—namely, making sure that the overall look of the updated center isn’t interfered with by tenants. To...

Make Tenant That Controls Its Space Responsible for Mold Issues

February 26, 2014    

Responsibility for mold-related damage in commercial and residential properties has become a hot-button issue in the past decade, as major storms like Hurricane Sandy have increased the potential for flooding and subsequent mold growth, and as tenants have become more aware of environmental...

Get Trademark License with Five Key Protections

January 28, 2014    

Competing with other nearby centers to draw in customers can be tough. You’re in a much better position if you have high-profile tenants that make your center a destination for customers looking for these particular stores. But no matter what type of center you own, you’ll want to...

Include Common-Area Accidents in Indemnification Clause

August 7, 2013    

An owner is typically responsible for maintaining the common areas of its building or center, so if someone is injured in these areas, the owner is the party that will most likely have to pay for damages from an accident. If the accident was caused by a condition stemming from the actions of...

Include Payments to Affiliates in Sublet Profit-Sharing Clause

April 24, 2013    

Typically, when an owner agrees to allow a tenant to assign or sublet its space, it uses lease provisions that require the tenant to give it some or all of its profits from any sublet or assignment. If your lease says that these profits include the sale of any of the tenant’s personal...

Mall Managers Hold Keys to Kiosk Profitability

April 5, 2013    

Shopping centers have been benefiting from a proliferation of kiosks and carts selling everything from hair styling tools to cell phone accessories to skin care products. Why have kiosks taken off in recent years? Kiosks have a low cost but a great potential to reap benefits. The cost of renting...

Specify “First-Run” Movies in Lease with Multiplex Theater

March 26, 2013    

If you have a multiplex movie theater tenant in your center, you’ll want it to show the latest popular movies so that it will attract crowds. That’s because movie crowds create foot traffic and other sales at your center. The whole center can benefit from this type of tenant. And a...