Retail Co-Tenancy Calculator

Co-tenancy clauses protect tenant against changes in center makeup.

Annual base rent

Alternative rent %

Months triggered

Total lease months

Rent savings to tenant

$133,333

Monthly alternative rent

$16,667

Monthly base rent

$33,333

How the math works

Monthly base = annual / 12. Alternative = base × alt %. Savings = (base − alt) × months triggered.

$400k / 12 = $33.3k base. $33.3k × 50% = $16.7k alt. Savings $16.7k × 8 mo = $133.6k.

How to Use

Enter annual base rent.
Enter alternative rent %.
Enter months triggered.
Enter total lease months.
Read rent savings to tenant.

Frequently Asked Questions

Co-tenancy triggers?

Anchor co-tenancy: rent reduction if specific anchor exits. Typical 50% rent reduction or right to terminate. Occupancy co-tenancy: trigger when center falls below threshold (typically 70–80%). Reduction: alternative rent (50–60% of base) or percentage rent only. Cure period: landlord typically 6–12 months to replace anchor or restore occupancy. Drives landlord lease-up urgency. Anchor TIs much higher partly to prevent co-tenancy triggers. Smaller specialty tenants: most likely to negotiate co-tenancy.

How does this asset class compare to traditional CRE?

Specialty assets (self-storage, RV parks, MHP, marinas, cold storage, data centers, parking, car wash, QSR/c-store, billboards, cell towers) typically offer higher cap rates than office/retail but with more operational complexity. They reward specialized operators with deep market knowledge. Lender pool is narrower, capital costs sometimes 50–150 bps higher, but downside resilience often better.

Capex and operational considerations?

Specialty assets often have heavier operational burden than passive triple-net retail. Self-storage, RV, MHP: tenant turn, security, basic upkeep. Marinas, parking, car wash: equipment-heavy with replacement reserves. Cold storage, data center: utilities are major cost. Billboards, cell towers: minimal opex, near-passive. Match management capacity to asset operational intensity.

Exit strategy?

Specialty asset cap rates have compressed significantly over last cycle but volatility is real. Buyers: REITs, private equity rollups, regional operators, 1031 buyers. Strong NOI history, environmental clarity (especially for car wash, gas station), and lease structure (for billboards, cell towers) drive valuation. Plan exit 24+ months in advance for best execution.