This week, I was working on an office acquisition and came across a clause I had never seen applied in office before – a most favored nations clause. The clause essentially read: Notwithstanding anything in the lease to the contrary, no other tenant in the Property shall have a more favorable rental rate (which was… Continue reading The most dreaded lease clause – Most Favored Nations
There is no question that a tenant benefits from being granted an exclusive use in a shopping center. More often than not, an exclusive ensure that no other tenant in the shopping center shall have the same use as tenant granted the exclsuive. (Occasionally, an exclusive shall read something to the effect of “There shall… Continue reading Extracting value from an exclusive
This past week, we were working on a sizable shopping center acquisition in the Southeast. Part of the center had been a mall that was “de-malled,” while the balance was developed in two additional phases. The original mall became a series of big boxes, some traditional small shop retail, a few restaurants and a bit… Continue reading Why should you care about the definition of the “Shopping Center” in the lease?
As I write this blog, the rest of my family is getting ready for Easter Sunday Mass. I can be ready in five minutes so I have a little time. There is the major religious significance of today, but there are also secular, lease-related consequences of retailers and retail venues operating today. Sometimes ignored in… Continue reading Are your tenants open or closed today? The value of lease required operating hours.
For purposes of prorata shares, leases will often define excluded areas as greater than some specified square footage. “The tenant will pay a prorata share of real estate taxes based upon the leasable area of the center excluding premises (or occupants) greater than 25,000 square feet.” You will see language like this in almost all… Continue reading Excluded areas – reducing or eliminating absorption
You really never know what you are going to find in a lease when you are doing acquisitions. About three years ago, we did two shopping center acquisitions in the Southeast for one of our institutional clients from a local developer. In one restaurant lease in each of the centers, the developer had negotiated a… Continue reading When Sloth from the Goonies is your leasing agent
I am sure I sound like a broken record to anyone who has ever taken more than one of my classes because I always (seriously always) bring up how language can be buried deep within a lease that can change the cash flow from a tenant. The best example I can give is one landord’s… Continue reading Buried language can burn you
Last month, we worked on a beautiful, relatively new lifestyle retail property in California. It was developed by company that traditionally develops office. We did not know that they were office developers when we started the project. It became obvious after abstracting the first two leases. How could it be obvious by reading lease? By… Continue reading Retail vs. office leases
It doesn’t get better than the landlord’s standard lease. Seriously. The language in the standard lease is typically the best the landlord can possibly do because changes negotiated from its standard almost always favor the tenant. A landlord doesn’t have a standard lease form and then have the ability to say “We are going to… Continue reading The landlord’s best case scenario – Its standard lease
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