Some retailers want to exercise lower rent rights at malls with Sears vacancies

Two companies want an Ontario court to lift a stay preventing them from exercising their co-tenancy rights at malls where failed retailer Sears Canada left a vacancy.

Gap Inc., which owns Gap, Banana Republic and Old Navy, and the Children’s Place filed notices of motion at the Ontario Superior Court of Justice earlier this month.

The documents say a co-tenancy right in a lease can give a retailer the right to reduce or restructure its rent if certain specified anchor tenants vacate the mall or reduce their square footage below a specific threshold.

In some cases, it can allow a company to terminate its lease without any penalties.

Sears Canada closed its last remaining stores Jan. 14 of this year after spending much of 2017 attempting to reinvent itself and bring in traffic.

The motions are scheduled to be heard in October.

The Canadian Press