Go Dark | Practical Law

Go Dark | Practical Law

Go Dark

Go Dark

Practical Law Glossary Item 0-507-0238 (Approx. 2 pages)

Glossary

Go Dark

The tenant's right to cease operations at its leased space while the tenant continues to pay rent. A go dark clause is commonly negotiated in retail leases.
The right to go dark provides tenants with maximum flexibility, which is especially important for large national retail tenants. For example, a national retailer that can cease its operations at a particular location may have a significant cost savings, even if rent is still being paid.
The use of a go dark provision can seriously upset the tenant-mix of a shopping center. Most landlords do not grant tenants the right to go dark without including certain protective measures in the lease for its own protection.
For example, a landlord will typically include in the provision its right to take back the tenant's space if the tenant exercises its right to go dark. The landlord's recapture right in a retail lease allows the landlord to terminate the lease after the tenant has gone dark, without either party being in default. However, a landlord typically exercises its recapture right only after it has secured a new tenant for the space.