Tenant Lease Sign Standards

 

 

Office buildings which contain more than one tenant often need a set of Tenant Sign Standards written into the lease agreements to organize and control the possible proliferation of signs by those tenants. Here is a list of some approaches to controlling tenant signs. Please keep in mind that this article refers to office buildings and mixed use facilities and not to shopping malls or major retail projects, although some similarities exist:

 

 

1. No Control

If the landlord truly doesn't care about what the signs look like or how big they get, the only control necessary is to require the tenant to abide by existing codes and ordinances. Be sure the lease indicates that all costs design, construction, permits, and inspections will be born by the tenant. Provisions to make the tenant liable for interruption of utilities such as power or water during installation are often helpful. Few landlords ever use this approach, simply because it can create conflicts with other tenants and usually generates many, large, and unattractive signs. It assumes that, short of breaking the law or causing global warming, the landlord really doesn't care what the tenant does about signs, as long as he pays his rent on time.

 

2. Minimal Control

This approach usually limits the location of signs, but not the size, number, or design, except as dictated by applicable codes. The logic here is that tenants usually feel they have a right to post signs on their rental premises and that is usually the way location of signs is described. Outside signs are limited to their building frontage, advertising is often limited to their own windows, and free-standing signs in public circulation areas are usually banned for traffic reasons. Sometime exceptions are made for upstairs tenants or locations which are architecturally out of the normal building traffic.

 

3. Medium Control

This method begins to reflect the landlord's own preferences regarding signage. Medium control usually entails limiting location, size, and number of signs and offers the most tenant option regarding design. Since applicable codes must still be obeyed, there are also upper limits on all three parameters. This method usually works for chain retail establishments who have strict corporate advertising and identity standards and who don't like to have color and design dictated by the landlord. They usually cite the need to be consistent with their national corporate standards and how using their own logos and colors will ensure quick recognition of their brand.

 

4. Maximum Control

Here we have the most ambitious approach to controlling tenant signs, in which design is controlled along with location, size, number, and code compliance. If a project has a particular design ethic which governs its architectural style or which presumes a general character for the entire complex, these design ideas should be written into the lease provisions to give prospective tenants a fair chance to understand what will be expected of them if they sign. Obviously, this type of restriction puts limits on the salability of the tenant space to some tenants, but the result is usually a very cohesive and coordinated look to the property. Typical limitations might be to control the color and material of a particular sign category, but allow the tenant's logo and typeface to be present. This method doesn't prevent allowing full-color corporate logos, but other limitations on size, placement, and dominance are usually intended to direct the overall look of the complex along certain design lines. In the 70's some airports tried to eliminate all corporate presence by insisting that concessions were listed in the signage as "Gift Shop" or "Snack Bar" in keeping with them being public services. This gradually died out and now airports happily use national brands and store logos as part of a "retail renaissance".

 

Many combinations of the above approaches are also possible; the landlord must determine what is in his best interest overall and position his standards accordingly.

 

 

 

Basic Parts of the Sign Standard

The following is a check-list of elements usually included in the sign standards in the tenant lease. Obviously the list should be edited to fit the project:

 

A. Responsibility for Signs

This provision outlines who pays for which signs; negotiations usually occur during the pre-lease phase and the agreements can vary from all signs being paid by the landlord or all by the tenant. Be sure dollar amounts are included to set upper limits on signs whose design is undetermined at time of lease signing. This is the section in which to address such things as the reuse of old signs from a tenant's previous location.

 

B. Review of Signs

This section covers the steps the tenant must take to have a sign reviewed and approved by the landlord. These provisions can range for a simple drawing submission to requirements for renderings to show impact on adjacent tenants. If your standards are of the Maximum Control variety, be sure that this process is well-defined and allows the landlord to reject any proposal without cause or the need to prove injury. Specific language for how long the process will take will protect both parties during the review process.

 

C. Location of Signs

This section outlines exactly where the tenant may place which types of signs. Since most mixed-used projects have both magnet tenants and other classes of smaller tenants, it is best to tie the provisions to the level of rent the tenant pays: the more you pay, the more locations and impact you get. Typically this section describes the location of tenant names, hours of operation, and advertising. Care should be taken if sign locations are permitted which are not directly connected to the tenant's premises, since other tenants rights and smooth public circulation can be affected. Beware of agreements regarding free-standing signs in public areas, such an sandwich boards; sometimes a permanent overhead canopy sign is better and will not restrict traffic flow.

 

D. Sign Construction

Even though the local building codes and local departments of land use & planning will regulate some of this, many landlord like to spell out any special materials or methods required to support a particular project look or style. Such regulation might include limiting the tenant identity signage to neon, or internally illuminated boxes, or non-illuminated boxes; projects which possess an historic character might require that all signs be consistent with construction methods of a particular period of history. Be sure there is no conflict between local building code requrements and the lease language. If your property is in a Local Improvement Corridor or has an existing set of design covenants worked out with the local planning departments, these need to be understood and factored into the lease provisions.

 

E. Sign Design

Color, material, typeface, and overall style are often regulated to achieve a particular project look, but these provisions usually conflict with corporate standards for national corporations. Care should be exercised to keep a balance between serving the tenants and being steamrollered by them. Discussions between the tenants corporate design group and the project's graphic designer can often resolve conflicts regarding style of application of corporate colors and designs.

 

F. Sign Maintenance & Removal

Be sure to specify who maintain the sign face, lighting, ballasts, housings, and structure after the sign is erected. Tenants usually feel that after the sign is attached to the building it somehow becomes the landlord's responsibility. This is the section in which to address what happens to the sign when the tenant moves, who cleans the faces and re-lamps the lighting during the lease period, and whose insurance covers damage to the sign. Provisions can be quite unusual in this area, because signs might be originally tenant property and then become part of the building systems when installed. Defining who is responsible for what part is a very useful issue to have settled in advance.

 

 

I hope this brief outline can be of help. If you have further questions, please contact me at kbd@olympus.net.