Should You Request Use of Specific Store Trade Name at Your Center?

Q: I'm negotiating with a supermarket tenant to open a supermarket at my center. The tenant owns supermarkets under various trade names around the country, and those stores operate either high-end (high-priced) models or low-end (low-priced) models. I want the tenant to operate a supermarket at my center under a specific trade name for a high-end model. But its lease form doesn't indicate which trade name the tenant will operate under at my center. What should I do?

A: Request that the tenant agree in the lease to operate its supermarket at your center under the specific trade name that you want. But be aware that if the tenant agrees to this request, it will very likely demand certain protections, such as the right to change the store's trade name if, for example, it sells its supermarkets in the region or another company buys it out.

Also, request that the tenant agree in the lease that its store's operations at your center will be similar to its high-end model store at a specific address. If it doesn't agree to that, request that its store's operations will be at least similar to all or most of its stores operating under the specific trade name that you want within the region.

Be aware that the tenant may simply refuse to agree to either of your requests. That way, it keeps the flexibility to change the supermarket's trade name and model if the demographics, competition, or other factors within your area or at your center change before its store opens. (Note that supermarket deals can take a long time to complete—typically two years from the start of negotiations to the opening of the supermarket—so such changes could occur during that time.)

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