Some commercial leases, particularly those in the retail sector, will contain contractual obligations about how tenants must conduct their business. One example is a keep-open clause, which details certain operating hours a business must follow. Ignoring a keep-open clause puts you at risk of breaching your commercial lease. This article will explain keep-open clauses in a commercial lease.<\/p>\n\n\n\n
A commercial lease agreement<\/a> is a legally binding contract between a commercial landlord and their tenant. It details the rights and obligations of both parties in a lease. For example, the lease agreement will describe the following:<\/p>\n\n\n\n A commercial lease agreement may also detail a keep-open clause.<\/p>\n\n\n\n A keep-open clause is a commercial lease provision specifying a tenant’s obligation to keep the premises open and trading during specific hours throughout the lease term. Typically, these hours will align with regular business trading hours. It applies mainly to retail premises and restaurants. <\/p>\n\n\n\n Additionally, a keep-open clause might state that the tenant must keep the front of the premises tidy, inviting and lit during these hours. Keep-open clauses are common in shopping centres due to the impact a closed business can have on other businesses in the centre.<\/p>\n\n\n\n You will typically find keep-open clauses in a commercial lease with turnover rent<\/a>. In addition to a base rent or open market value rent, the tenant pays a second rent, which usually reflects an agreed percentage of their turnover. A keep-open clause is reasonable in these leases. Without it, a tenant may not open for business at prime times, depriving the landlord of the turnover event they might otherwise have had. <\/p>\n\n\n\n\n\n Continue reading this article below the form\n <\/i>\n<\/a>\n\n
What Are Keep-Open Clauses?<\/h2>\n\n\n\n