Perimeter and Outparcel Redevelopment in Retail Centers: Due Diligence and Documentation

Recording of a 90-minute CLE webinar with Q&A


Conducted on Thursday, April 26, 2018

Recorded event now available

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Program Materials

This CLE webinar will examine due diligence and transaction concerns with development and redevelopment of outparcels in regional shopping centers, strip centers and lifestyle centers. The panel will discuss how best to deal with existing operating and reciprocal easement agreements (REAs), splitting off outparcels from existing centers, dividing a vacated big box on an outparcel into multiple tenant spaces, site planning, navigating development restrictions in recorded leases and deeds, and more.

Description

A retail center may not be functional in the manner initially configured. A big box tenant moves out, large parking lots are no longer necessary or customers’ needs change. This often leads to a redevelopment involving dividing single spaces into multiple spaces, aggregating or reconfiguring outparcels, carving out or spinning off portions of a development to third parties, and combinations of any or all of these approaches.

There are often use and other restrictions in an REA. The extent to which an REA requires amendment will depend on the level of change contemplated, the exiting parties, property to be added or removed, and other factors. Counsel must check leases and deeds in the chain of title for any restrictions, including consent or purchase rights, and review recorded site plans that may show drive-throughs, height restrictions, or curb cuts impacting further development.

Developers can divide former big-box stores into smaller tenant spaces that anchor a perimeter development or raze a store to create new perimeter development. An anchor or big box owner may want to develop an outparcel on its property in the center. Agreements should delineate relationships, perhaps with new REAs between different owners within the perimeter center or between the owners of the larger center and the outparcel or perimeter center.

Listen as our authoritative panel explores these and other issues that owners, tenants and purchasers may encounter in redeveloping outparcels in a retail center. The presenters will discuss addressing restrictions on the development parcel, overcoming issues with dividing parcels or buildings for multiple tenant uses, and more.

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Outline

  1. Evolving uses for retail outparcels: reasons for redevelopment
  2. Existing REAs, leases, deed restrictions: impact on development, determining amendments needed
  3. Complying with or amending an existing site plan
  4. Carving outparcels from an existing center or aggregating parcels
  5. Redeveloping the building or parcel
    1. Subdividing for smaller tenants
    2. New REAs
    3. Alternative uses
  6. The role of municipalities and lenders in the outparcel and perimeter redevelopment process

Benefits

The panel will review these and other key issues:

  • What factors should an owner or purchaser consider in deciding whether a vacated outparcel or building is suitable for redevelopment?
  • How might an REA impede redevelopment, and when should it be amended?
  • What steps should be taken when the proposed development will deviate from the previously approved site plan?
  • What issues should a developer consider before reconfiguring an existing big box store for multiple tenants?

Faculty

Boyle, Kathy
Kathleen Dempsey Boyle

Partner
Meltzer Purtill & Stelle

Ms. Boyle focuses her practice on real estate, particularly leasing, development and redevelopment of retail, mixed...  |  Read More

Nackeeran, Sindhoo
Sindhoo Nackeeran

Meltzer Purtill & Stelle

Ms. Nackeeran is a commercial real estate attorney with experience representing a variety of private equity real estate...  |  Read More

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