It's rare that an ordinary commercial lease term can make
national news, at least indirectly.
Some higher-profile stores are bucking the Holiday trend this year
and refusing to open on Thanksgiving day.
Costco, Lowe's Home Improvement Centers, Nordstrom, DSW
and Marshall's -- notably, representing an array of retailer
species from big box to home improvement to specialty to clothing
-- have each announced publicly that it will not open on
Thanksgiving day.
This is a noble position, to some.
However, many commercial retail leases contain clauses requiring
that the tenant remain open and continuously operate during
business hours, with only certain exceptions. These clauses
serve at least one important purpose to the landlord and to the
other tenants in the shopping center: if stores are mostly closed,
or closed in large part, shopping mall traffic will of course
reduce. The less traffic, the fewer customers to spend, which
is catastrophic for all stakeholders in a shopping center.
Makes sense, right?
These clauses are otherwise uninteresting, nationally. But
what happens if a store wants to close its doors on a given day to
commemorate an event, a Holiday, or honor a notion?
As to the continuous operation clauses in leases, if Thanksgiving
day is not an exception, or if the hours of operation are specified
on that major shopping day, the tenant who chooses to close on
Thanksgiving day could face repercussions at the hand of a
landlord.
Just such a thing is happening in New York, apparently. It
seems an upstate mall is threatening to fine any of it
retail tenants, presumably pursuant to a lease term, that do
not open on Thanksgiving day. The mall is taking its lumps,
but we'd wager that it has the contractual right -- in
the lease -- to do what it is doing, generally.
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