A Brief Introduction About Mall Lease
A mall lease or a document for mall leasing is known to be an official document that helps in solidifying the specific terms & conditions between the individual who is taking the lease for the mall space and the landlord of the given shopping mall space. A shopping center or mall lease also goes by the name as a ‘private contract.’ The agreement is known to state the amount of rent that has been agreed upon along with the total time for which the lease will be operational. While entering the agreement, it is recommended for the tenants to be extra careful before signing the document. The tenant should go into reading each & every term of the contract before signing the same.
Who Takes the Mall Lease?
A mall lease agreement is usually taken up by the tenant (the individual who will be leasing retail space in a mall/mall kiosk) and the landlord or owners of the mall or rental space in the mall. All the shopping centers around the world are said to have been built on the foundation of some paperwork. Out of all the legal documents upon which the development and operations of the shopping centers are based, the mall leasing document is regarded as the most important one.
Purpose of the Mall Lease
There are specific rules that are set out in the legislation of retail leasing that is known to be applied to all business organizations operating in a shopping center or mall. There are various reasons why shopping mall leasing is considered as vital. The store leases in a shopping mall help in creating a steady source of revenue for both the developers as well as the tenants. Store leases can also be used for governing the types of products that can be sold out in the shopping mall areas along with stating the specific kind of services that tenants are expected to deliver in the given mall area. The mall leasing document for providing the in-depth rules for the various types of housekeeping chores to be implemented by both the tenant and the landlord.
Contents of the Mall Lease
The official document for the commercial space for lease in a shopping mall is typically known to define the parties involved in the contract –holder of the rights of the property (referred to as the ‘lessor’) and the user or consumer of the property rights (referred to as the ‘lessee’ or the tenant) for a specific period of time. Some of the major components of such a lease are:
- Name as well as the contact information of the parties involved (the landlord and the tenant)
- Information about the guarantor
- Date of the contract or agreement
- Premises of operation
- Term of the contract
- Payment modes of the rent amount
How to Draft the Mall Lease?
While drafting the mall agreement or lease document, it is essential to include all the necessary obligations as well as the responsibilities of each party in the given contract. While preparing the draft of the lease document, here are some of the important aspects of the given agreement that you should include:
- Rent payment modes
- Insurance risks
- Compliance with laws
- Rules & regulations
- Covenants of the landlords
- Abatement & termination of the clause
Just like every other legal document, the mall leases should also be reviewed by qualified & experienced attorneys.
- Issues related to mall leases: Leases related to shopping malls are one of the most challenging leases for negotiations on behalf of the tenants. If you are finding it hard to negotiate with the landlord to the shopping center lease, you can hire an attorney to do the task on your end.
- Balance of Needs: Shopping mall landlords are known to ensure maximum flexibility with the given space while often seeking short-term leases with a list of personal guarantees. As a tenant, you must understand as well as negotiate the overall real cost of occupancy beyond the concept of the base rent.
- Speed & Responsiveness: Another important aspect to consider is the speed and responsiveness of the contract for effective negotiations.
Benefits & Drawbacks of Mall Lease
Signing a mall contract comes with its own sets of benefits as well as drawbacks. Some of the potential benefits are:
- The contract serves as a legal document that helps in binding the parties involved on legal grounds.
- The contract serves helpful in case of violations or breaching of the terms & conditions of the contract.
- The contract helps in creating a source of revenue for both the landlord as well as the tenants of the shopping mall spaces.
At the same time, some of the demerits might include:
- The landlord might misuse the terms & conditions of the contract to belittle the tenants’ rights.
- The overall concept of leasing might cost more than truly buying the properly or mall space.
What Happens in Case of a Violation?
There are some common grounds during retail leasing space in a mall for serving as terms of violations(1). Some are:
- Tenants not paying the desired rent on time
- Landlord misusing the right of the tenants
Upon violations of the terms & conditions of the lease, either party can decide to sue the other party legally or terminate the overall contract altogether.
Mall leases or contracts are becoming highly popular in the modern era. Whether you are a tenant or the landlord, you must go through the important terms & conditions of the contract wisely. Make sure that you take relevant help from a reliable attorney to get the best desired outcomes. Understand each & every term of the contract, and only then, you should sign up on the same.