Shopping center owners to receive right to terminate lease agreements ahead of time with retailers from unfriendly countries exiting Russian market - Mishustin

MOSCOW. May 24 (Interfax) - The Russian government will permit the owners of shopping centers to terminate lease agreements ahead of time with retailers from unfriendly countries that are exiting the local market, Prime Minister Mikhail Mishustin said at a meeting of the presidium of the government commission on improving the stability of the Russian economy amid the sanctions.

"We intend to extend the owners the right to terminate lease agreements ahead of time with companies associated with unfriendly countries," Mishustin said.

Mishustin explained that the government has based its decision on the fact that the owners of the shopping centers are now receiving less revenue from those retailers that have shut down if rent is pegged to tenants' revenue.

"The text of an agreement between an owner and a tenant has often previously included a clause stipulating that the amount of [rental] payments would depend on a store's revenue. This currently results in unpleasant situations, where some foreign companies have suspended operations for political reasons, and they are in no hurry to vacate the premises, with the signs [still] hanging, and rent does not go to the owners, because there is no revenue," Mishustin explained.

"As a rule, this concerns fairly large tenants, and, respectively, the losses of the owners of the premises are also significant," the prime minister said.