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Macerich, GGP Accept Lower Rents

U.S. mall owners General Growth Properties Inc., Kite Realty Group Trust and Macerich Co., faced with rising vacancy rates in the recession, are being forced to accept lower rents from their remaining tenants.

Real estate investment trusts that own retail properties are getting snagged by co-tenancy clauses that allow merchants to pay less when anchors like department stores shut down, according to Real Point LLC data based on loan-servicer reports.

“A year ago, tenants in major shopping centers were rarely invoking co-tenancy clauses,” said Charles Daroff, a partner at Hurtuk & Daroff Co., a Cleveland-based law firm that specializes in real estate. “Today, with the disappearance of major tenants and increasing vacancies, these clauses are being triggered.”

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