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For retail landlords and tenants, there are various ways in which mutually beneficial partnerships can be formed in order to maximize returns for both parties. Beyond the standard retail lease, you can incorporate specific terms and conditions as negotiated between you and the tenant.
Exclusive use clauses are one key example of this. Incorporating an exclusive use clause in your retail lease is a great way to ensure long-run returns for both you and the tenant. If you look at successful examples of exclusive use in retail leases like Publix or CVS, the benefits are clear.
But with every give, there is some take.
If you plan on incorporating an exclusive use clause into your retail lease, you need to consider – as always – the cons as well as the pros. If you’re not careful, exclusive use clauses can fall heavily in the tenant’s favor, leaving you with a financial albatross.
For this edition of Lawfare, we have attorney Rob Gidel join us to talk us through the nuances of exclusive use clauses and how to navigate potential pitfalls in your retail lease.
You’ll remember Rob from past episodes in which we’ve discussed areas ranging from 1031 Exchanges and net lease investments, to building a successful partnership with your real estate attorney.
In this episode, Rob gives us an overview of the potential pros and cons of exclusive use clauses and touches on specific points contained commonly contained within them such as:
- Clause-specific language
- Blanket restrictions on competition and use outside of original restriction
- Continuous operation clauses
You don’t want to miss this special Lawfare edition in which we discuss incorporating exclusive use clauses in your retail lease!
