Shaving costs during this pandemic-fueled, troubled economy, according to NRTA members Gregory D. Call, Esq. and Jennifer S. Romano, Esq. is absolutely possible and even a matter of life and death for some retail tenants. As shopping centers reach unprecedented vacancy levels, now more than ever retailers need to assert their co-tenancy rights. Reviewing the precise language in your lease is well worth your time and may result in finding solutions to cut costs.
“Vendors are offering services that track store closings at shopping centers for purposes of co-tenancy claims,” note Call and Romano. In some cases, “Retailers are seeking reduced rents or even terminating leases when co-tenancy conditions are not satisfied.” It is important to gather your facts and review your lease to identify the specific language related to your co-tenancy rights.
Retailers can often learn a lot by doing some research on their own, searching the internet or doing a walk-through of the shopping center. Call and Romano outline four steps retail tenants can follow to gain insights on their leases and how to prepare for negotiating better terms, if necessary, in the future. (Read the full article in the legal section of the NRTA Professional Library.)
Ask the right questions.
- Do you really know if the provisions of your co-tenancy lease are being met?
- What are you doing to counter your stores’ decrease in foot traffic and drop in sales?
- Does your lease require that certain anchor stores be open and operating?
- If you are not satisfied with your current lease provisions, what adjustments can you address moving forward?
The pandemic is far from over. It is time to take a fresh look at how retail tenants can identify—and implement—strategies to cut costs. Read the full article, “Legal Corner: Co-Tenancy Rights: Shaving Costs in the Struggling Economy.”
About the authors: The above is based on an original article written by NRTA members Gregory D. Call, Esq. and Jennifer S. Romano, Esq.
Free Trial Membership
Experience the professional benefits of NRTA membership for 90 days.