Co-Tenancy Clause

Two flavors: opening and ongoing

Opening co-tenancy applies before the tenant first opens: it requires a stated set of anchors or a percentage of the center to be open by the tenant's commencement, and delays the obligation to open or to pay full rent until the condition is met. Ongoing (operating) co-tenancy applies for the life of the lease: if a named anchor goes dark or overall occupancy drops below a threshold, the tenant's remedies kick in.

The usual remedy ladder

• Alternative rent: a reduced rate — commonly a percentage of sales or a fraction of fixed rent — for as long as the failure continues.
• Cure period: the landlord gets a negotiated window to replace the anchor or restore occupancy before remedies escalate.
• Termination: if the failure runs long enough, the tenant may terminate — though many clauses force it to elect between returning to full rent and leaving.

What to watch for

The definitions carry the risk. Does a replacement have to be a comparable retailer, or does any occupant count? Does an anchor that goes dark but keeps paying rent trigger the clause? Can alternative-rent periods stack across multiple simultaneous failures? Landlords also negotiate sunset provisions that end the remedy if the tenant's own sales did not actually suffer. And because one anchor's departure can trip co-tenancy rights across many leases at once, these clauses are a routine focus of acquisition and lending review.

In your documents

A single vacancy can implicate co-tenancy language across a whole rent roll, and each lease words its trigger differently. Sevrel is designed to help you find and compare those provisions with answers linked to the retrieved lease text — the kind of cross-portfolio question lease analysis exists for — with the usual caveat that retrieval may not surface every relevant lease, so confirm the review set before acting.