This week, we were working on an acquisition of a property in the southeast. One tenant occupied the majority of the property, with a handful of other tenants accounting for about 10% of the leasable area, but about 20% of the income. There was a restaurant tenant that had a unique name that I had… Continue reading A couple of percentage rent/gross sales issues this week
I grew up using the expression “same difference.” I think I used it when I said something that I believed was right, but someone pointed out something that was wrong about what I said – but it wasn’t important enough for me to care. I think today I would probably just say “whatever.” There are… Continue reading Same difference – more subtle changes in lease language
Way back when in high school, I was on stage crew for the school’s productions. What I realized was that after doing that for several years, whenever I went to a Broadway show or musical, I would be at least as interested in how the crew handled the sets and lighting and sound as I… Continue reading Looking behind the retail curtain at the holiday
I love the shows Pawn Stars, American Pickers and Mysteries at the Museum. With these shows, they find an item that interests them, authenticate it and then give a bit of history on the piece. As geeky as it may sound, there can be identifiable histories to leases and lease language. Did you ever pick… Continue reading “I need to call in my friend Pete to get some more information about this lease…”
There are a few percentage rent calculation issues that make me happy (from a landlord perspective. If you are a tenant, you hate these!). True partial lease years – where a sales for a portion of a year are compared to the breakpoint for a portion of the year, and the tenant pays sales on… Continue reading The percentage rent unicorn
Site plan of King of Prussia Plaza from the early 1960s with an Acme Supermarket: Since the 1970s, it has not been common to see certain types of tenants in regional malls as department stores enforced certain types of use restrictions that existed in their leases (often to protect parking). However, as closures of former… Continue reading Gross sales/percentage rent considerations when backfilling a department store/big box
This weekend, I was in South Bend and Chicago. On the way back to O’Hare, my wife and I had some free time, so we stopped at Macerich’s Fashion Outlets of Chicago. Besides having a beautiful, well thought out tenant mix, they have an outstanding parking garage. An outstanding garage, you say? Absolutely. I am… Continue reading Red light, green light, 1, 2, 3 …
Over the years, we have worked on 150+ tenant regional malls where the sellesr had been using 3-4 expense pools per prorata expense category, and we have also worked on 20 tenant open air centers where the seller had been using 20 different expense pools. What’s right? As new variables are introduced into leases, the… Continue reading How many expense pools are required?
I would have to guess that we may have annoyed a client this week because we would not drop an issue. Their leases required the inclusion of licensee square footage in Gross Leasable Area (GLA). Generally, most standard leases today define licensees as exclusions when calculating prorata shares. (Licensees themselves are typically defined as short… Continue reading Phantom Square Footage
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