In the world of retail leasing, it can take time for some of the tried-and-true clauses to catch up to reality. One example is the traditional list of prohibited or “noxious” shopping center uses. Such a clause, often included in the leases for anchor stores, was intended to restrict the activities within a shopping center to the sale of goods, rather than services, in order to keep the flow of shoppers steady and to avoid having parking spaces tied up by non-retail users. However, it is no longer uncommon to see certain types of service providers – such as so-called “retail” medical locations, financial services operations, or yoga or spinning studios – in suburban shopping centers.

These uses can actually bring more foot traffic into a shopping center, which benefits all tenants. For instance, a person dropping in to a walk-in health clinic might have a prescription filled in an adjacent pharmacy or in the pharmacy section of a neighboring grocery store. Someone visiting a storefront financial services location to meet with an advisor and sign paperwork on their lunch break might grab a salad at the restaurant next door before heading back to the office. The way in which these types of services are used makes them a comfortable fit in a retail shopping center. However, under the traditional prohibited use clauses seen in many anchor store leases, these types of uses fall under the broad definitions of “office,” “non-retail,” or “health club” uses and are prohibited.

Given how suburban shopping centers are changing, landlords aiming to create a tenant mix that is most appealing to shoppers would be wise to review the prohibited use provisions in their anchor store leases. It could be beneficial to redefine “retail” uses to include service providers such as “retail” medical locations, financial service outlets, or fitness studios offering drop-in classes, or to carve these types of uses out from the definition of “office” use. After all, these uses might well be more analogous to retail uses than to traditional or general office uses. What’s more, they are increasingly recognized as bringing significant foot traffic into shopping centers, which is something both landlords and tenants can get behind.