With COVID-19 emergency orders in place, many malls have
shut their doors and U.S. retailers have gone dark.
What does this mean for retail landlords whose tenants
have co-tenancy provisions in their leases? Much depends on
the details of the particular clause.
Will Co-Tenancy Rights Kick In?
A co-tenancy provision (obligating a landlord to maintain a
certain percentage of open and operating space within a shopping
center and/or the continued operation of specific named anchor
tenants) typically requires that the subject stores be closed for a
period of time before co‑tenancy rights are triggered.
In many leases, a mere 30 or 60 days of store closures will not
grant a tenant any remedies under the co-tenancy provision but may
grant an intermediate remedy such as reduced rent. The
co-tenancy provision is often subject to a cure period, sometimes
of up to a year, before a tenant gains the right to terminate the
lease. It is important to analyze
