Retain Control Over Parking Lot Business

Letting a business use a portion of your outdoor parking lot can be an innovative way to earn additional revenue and boost traffic at your center. While business-related activities, such as book sales, car sales, and boat sales seem to be a relatively quick and easy way to bring in more cash and positive publicity for you and your tenants, they can get out of hand and jeopardize the center if you don’t control them in a way that’s conducive to your regular operation—the one that tenants have carefully negotiated for. Because business-related parking lot events typically last no longer than a few days, you should negotiate a “license agreement” rather than a lease.

A license is better than a lease in this scenario because it gives you more control over the length and limit of the use of the space. Make sure to grant the licensee only a “nonexclusive, revocable, and nontransferable license” to operate in a designated portion of the parking lot. And make it subject to the terms and conditions set out in the license agreement. By making the license “nonexclusive,” you can grant licenses to other parties that have a right to use that area under leases or other agreements. “Revocable” means that you can take back permission to use that portion of the parking lot, at your discretion. And “nontransferable” bars the licensee from transferring the license to anyone else.

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