Percentage Rent Clause
(Restaurant Lease, Shopping Center)

Summary

This percentage rent clause may be included in a lease for restaurant space to require that the tenant pay a percentage of its profit to the landlord as additional rent. This clause contains practical guidance and drafting notes. Landlords in shopping centers, high-end hotels, and other settings where the landlord believes it provides an environment favorable to enhanced sales for the restaurant tenant, often include percentage rent provisions in their leases. The capitalized terms used in this clause should be conformed to the defined terms in the relevant restaurant lease. For a full listing of key content covering retail leasing, see Retail Leasing Resource Kit. For more on restaurant leases, see Restaurant Lease Agreements. For a restaurant lease agreement template, see Restaurant Lease (Short Form) (Shopping Center).