Non compete clause - Landlord Forum thread 361072

Non compete clause by unicorn1 on January 26, 2021 @14:56

I recently bought a commercial building in a small town with eight suites in it. One tenant wants a no compete clause in her lease renewal. Are there any landlords out there that can weigh in on no compete clauses?

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Re: Non compete clause by Garry on January 26, 2021 @16:28	[ Reply ]

I'm just guessing on this. You could probably have a no-compete clause inside the building that you own, and for the same type of business. So for instance, if you had a pizza parlor as a tenant, you could either say no other pizza places are allowed in your building, as long as that tenant stays there, OR no more food places in your building, like a Subway, or a small restaurant. But you can only regulate businesses in YOUR building. You have NO control over other buildings you DON'T own. So another pizza place or Subway or small restaurant could locate right across the street, in a building you don't own, and that would NOT be a violation of YOUR non-compete clause. You would need to check with an attorney to be sure on all this.

Re: Non compete clause by Daniel (CA) on January 28, 2021 @19:19	[ Reply ]

I would increase the rent for that additional clause or some other compensation, but if again it guarantees the tenant to remain longer that may be the equitable compensation. in other words dont do it unless you get something from it. but make sure that the no compete clause expires when the tenant vacates. Ive seen this type of case on J Judy