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Staff Report to Redevelopment Commission
Policy to Waive Lease Term for Vacating Tenants
Prepared 7/6/11
Occasionally a tenant in the Michigan Street Shops or Wayne Street Retail space will
move out before the term of their lease has expired. Under certain conditions, included in
the attached policy, it may be appropriate to release the tenant from the terms of the lease.
When an early voluntary move out occurs, the Commission has the right under the lease
to collect rent for the space until the term expires or until the space is leased to another
party, whichever occurs first.
Voluntary move outs in Commission owned retail spaces have occurred primarily due to
tenants acknowledging their business cannot be sustained. In lieu of incurring further
debts and falling behind on rent, some tenants have taken the proactive step of working
with us to vacate the space before their lease term has expired.
While the attached Policy is more specific, the conditions required to release a tenant
from the original lease term would ensure the tenant has paid all rent and any other
expenses due, and is not relocating to another store front.
Recently we have seen more experimentation with our downtown retail space such as the
Pop Up Shops. And we have seen other unique businesses occupy the retail space. We
have had a yoga business and a fine stationary business. Another unique business is
Bombay Imports, which did well until the recession, then needed some relief which the
Commission granted. As we continue to lease our retail space it is expected there will be
businesses that are good fits for the downtown, and others where the fit may ultimately
not be right.
This type of Policy recognizes the Commission's willingness to be flexible and work
with businesses that have made a good faith effort, kept current on their rent and gave
notice of their need to vacate before the lease term expired.