Capturing Online Sales in Shopping Mall Commercial Leases

Robert Kalanda, B.A. (Hons.), J.D.Commercial and Contract Litigation, Contract Disputes, Counterfeit Goods, eCommerce | Online Retail, Shopping Mall Lease Disputes, Shopping Mall Lease Litigation0 Comments

As more business is done online, and as traditional brick-and-mortar retail stores decrease in popularity, shopping malls and retail shopping landlords are looking for more creative methods to maximize rental income. It is not uncommon for a shopping mall lease to require the tenant to pay a percentage of their sales as part of the additional rent. Many stores, however, also do a significant amount of business online. While tenants usually consider such sales to be separate from sales at their physical storefront, landlords may consider those sales as attributable to the storefront and subject to additional rent.  It is important for any commercial lease to be clear how additional rent is calculated, and if additional rent includes a percentage of revenues, it should be clear to all parties what revenue is included and what revenue is excluded. Where a lease is unclear, the court will often rely on the principle of contra proferentum and … Read More