Apportioning Costs for Tenant’s Relocation in Current Center

Q A current tenant is negotiating a move to another space in the same retail center I own. Which relocation costs are fair for me to pay, and what costs should I expect the tenant to cover?

A If the tenant is moving at your request, then it may negotiate for you to pay:

•      Moving costs—including moving any equipment, fixtures, and inventory from the current location;
•      Planning and design costs for the new space;
•      Construction costs for the new space;
•      Soft costs, such as legal fees, architectural plans, and marketing expenses; and
•      Any money lost if the business is temporarily forced to close during the relocation period.

If the relocation is the result of the tenant’s request, however, you may have more leverage in negotiating who will pay for these costs.