We suggest that all Landowners take a moment to review the termination notification requirements included in their billboard lease. Oftentimes, billboard tenants will include some cunning language that allows for the lease to automatically renew under the same terms unless notified prior to the lease expiration. Here’s an example we pulled from another lease:
“This lease shall continue in full force and effect for its initial term and thereafter for successive like terms, unless not less than ninety (90) days (and no more than one-hundred twenty (120) days) before the end of any such initial or subsequent successive like term Landlord or Tenant gives notice of termination.”
Take notice how the Landlord in this case only accorded 30 days to provide notice of termination. If no notice is provided within that window, the lease automatically renews for a successive like term. If this were a 10-year lease, with an undervalued rate and the landlord missed their small window to give notice, the landlord is going to be locked in for another 10 years at the same rate. We see this happen too often to Landlords all across the country.
SignValue recommends checking your lease immediately to understand the termination requirements. If your lease includes similar language, we suggest sending a signed letter to your tenant at the earliest date possible informing them of your intention to terminate your lease at expiration.
Keep in mind, providing notice of termination is not the equivalent of demanding your billboard tenant to vacate the premise immediately. This is simply a notification to your tenant stating your intention to not allow this lease to automatically renew without the opportunity for a rate increase or amendment. Maintain a record of your letter with your lease so that it can be provided at a later date if needed.