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15 Cards in this Set
- Front
- Back
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When scheduled rent is less than market rent, a tenant on a long-term lease who no longer desires the space should consider
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B)assigning the lease.
The answer is assigning the lease. Because the market rent is higher, a prospective tenant might agree to pay a fee for the assignment. Normally, a sublease is for part of the premises or for part of the lease period.
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The success of a small shopping center is generally tied to the
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C)success of the tenants.
The answer is success of the tenants. If the tenants are successful, the shopping center will be successful. |
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The type of shopping center that best lends itself to condominium conversion is the
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B)neighborhood.
The answer is neighborhood. Because of the number of small tenants, many are in a position to buy their own space. |
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You agree to the assignment of a lease to a new tenant for the remaining term of an original lease, but at a lower rate. You may require the original tenant to do the following things, EXCEPT to
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C)remain on the premises.
The answer is remain on the premises. The old tenant may move at any time, but may continue to be financially liable. |
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A landlord is negotiating a lease for a community shopping center with a drugstore tenant who wants to lease 15,000 square feet. Indications are that rents in the area will increase over the foreseeable future. The recommended lease term would be for
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B)a relatively short period of time
The answer is a relatively short period of time. This will allow an increase to the market rent at a future date |
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A landlord should insist on which clause in a long-term lease?
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C)Escalation
The answer is escalation. An escalation clause protects the landlord in case taxes, utilities, or other costs increase faster than planned. |
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Many customers often choose to shop at a neighborhood center rather than a community or regional shopping center because
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A)it saves time.
The answer is it saves time. The small centers are more efficient shopping for customers who are not on a major shopping run. |
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After two years of a 10-year lease, a tenant approaches you with the intention to move, and brings you a potential tenant to whom he wants to assign his lease. The new tenant wishes to have a low fixed rate for a long period of time. There is no assignment clause in the existing lease. You can NOT
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B)negotiate with the new tenant.
The answer is evict the old tenant although they are current in rent. Stating a desire to move is not considered a default in the lease. The landlord could negotiate with the new tenant, hold the old tenant responsible, or solicit new tenants.
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Which type of tenant would be LEAST likely to occupy a store in a regional shopping center?
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D)Grocery store
The answer is grocery store. Grocery stores normally locate in community shopping centers and neighborhood centers. |
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A successful national chain drugstore offers to pay you a percentage of its revenues above a base amount. In return, it asks for a lower base rate for rent. What is it asking for you to do?
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B)Share the risk of its success
The answer is share the risk of its success. The percentage lease, whereby the tenant agrees to pay a percentage of the rent, can be a very profitable strategy for the investor who believes that the store will be highly successful. |
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Which type of shopping center would have a supermarket, a department store, and other small retailers?
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C)Community
The answer is community. A community shopping center has a supermarket, a major general merchandise tenant, and other small tenants. These centers are normally 100,000 to 300,000 square feet in size. |
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The management of a regional shopping center includes responsibility for all of the following activities, EXCEPT
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C)hiring trained personnel for the tenants
The answer is hiring trained personnel for the tenants. Shopping center managers do not act as employment agents for their tenants |
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To avoid the problem of closed, dark stores in community shopping centers, landlords find the LEAST effective approach is to
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D)get a security deposit of at least one month's rent.
The answer is get a security deposit of at least one month's rent. This would not help prevent a tenant from closing the store, but continuing to pay rent.
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Which of these is FALSE?
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A)Community shopping centers service a trade-area population of over 400,000 people.
The answer is community shopping centers service a trade-area population of over 400,000 people. Community shopping centers service a population of 40,000 to 150,000 people. |
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An investor is analyzing the market for a new shopping center. She wants to be certain that she has a few tenants that will generate traffic to her center. Which tenant would NOT be expected to generate traffic?
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C)A furniture warehouse The answer is a furniture warehouse. Supermarkets, discount stores, and dollar stores generate retail traffic.
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