Retail space types
Street-front retail sits directly on a main street or high street, typically in older buildings or mixed-use developments. Customers often arrive on foot or by transit, and storefront presence does much of the marketing.
Strip plazas (neighbourhood or community centres) are rows of units with surface parking, usually built around convenience: groceries, pharmacy, quick-service food, personal services and medical uses.
Shopping centre units in enclosed or open-air centres come with more formal rules: set operating hours, common-area charges, merchandising guidelines and frequently a centre-wide tenant mix strategy.
Restaurant and food-service spaces may be purpose-built or "second-generation" (previously a restaurant), which can reduce build-out work if existing infrastructure is usable and compliant.
Mixed-use retail occupies the ground floor beneath residential or office. Use restrictions, noise, odour, garbage handling and loading are often more tightly managed.
Frontage & visibility
Frontage is the width of the unit facing the street or parking field. For many retailers, frontage matters as much as square footage: it determines window display, signage width and how easily the store is noticed. Consider sightlines from both directions of traffic, corner exposure, obstructions such as trees or transit shelters, and whether the entrance is at grade.
A deep, narrow unit and a wide, shallow unit of similar size can perform very differently depending on the concept.
Foot traffic & trade area
Traffic is about who passes, not just how many. A commuter corridor, a weekend destination street and a plaza beside a grocery anchor each deliver different customers at different times. Useful questions: what draws people here, when are they here, are they in a hurry or browsing, and does your business serve that trip? Daytime population, nearby residential density, transit stops and complementary businesses all shape the trade area.
Gross vs. net leases
In a gross lease, the tenant pays one rent amount and the landlord is responsible for most property operating costs. In a net lease, the tenant pays base (minimum) rent plus a share of the property's operating costs, commonly realty taxes, building insurance and common-area maintenance, often called additional rent or TMI.
Many GTA retail leases are net, sometimes described as "triple net." Labels vary, so the lease wording, not the label, determines what is recoverable. Ask what's included in additional rent, how it is estimated and reconciled, whether management or administration fees apply, and whether there are any caps or exclusions for capital repairs.
Utilities, HVAC maintenance and in-unit repairs are frequently the tenant's responsibility in addition to additional rent.
Percentage rent
Some retail leases, more commonly in shopping centres, include percentage rent: the tenant pays base rent plus a percentage of gross sales above a threshold (a "breakpoint"). This aligns rent with sales performance but requires the tenant to report sales, and the lease defines what counts as gross sales. Exclusions (returns, taxes, gift card sales, online orders) are negotiable and worth reading carefully.
Permitted use
The permitted use clause defines what the tenant may do in the premises. Drafted too narrowly, it can prevent you from adding a product line or service later, and can make the business harder to sell, since a buyer inherits the same restriction. Landlords, meanwhile, use permitted use to manage tenant mix and protect exclusives given to other tenants.
Permitted use under the lease is separate from what municipal zoning allows. Both must align.
Exclusivity clauses
An exclusive restricts the landlord from leasing other units in the property to a competing use. Tenants seek exclusives for their primary business; landlords grant them carefully, since each exclusive limits future leasing. Key details: how the protected use is defined, whether it covers incidental sales by other tenants, which existing tenants are exempt, and what happens if the exclusive is breached.
Co-tenancy
A co-tenancy clause gives a tenant remedies, such as reduced rent or a right to terminate, if specified anchor tenants close or occupancy in the centre falls below an agreed level. These clauses are more common in larger centres and with tenants who depend on anchor-driven traffic. They are heavily negotiated and not always available.
Signage rights
Signage can include fascia signs above the storefront, panels on a shared pylon or monument sign, window graphics and blade signs. Leases typically require landlord approval of design, and municipal sign by-laws and permits apply. Confirm in the offer what signage you are entitled to, where, at whose cost, and whether pylon positions are guaranteed.
Parking
In suburban plazas especially, parking is part of the customer experience. Parking ratios are set by municipal zoning and by the property's site plan; some uses (restaurants, fitness, medical) may require more parking than others, which can affect whether a use is allowed. Ask whether parking is shared or reserved, whether there are time limits, and how peak hours overlap with neighbouring tenants.
Restaurant tenants & municipal licensing
Food-service tenants should confirm before firm commitment:
- Zoning permits the restaurant or take-out use at that address.
- Exhaust & venting can be routed to code, including approvals from the landlord and any neighbours affected.
- Grease interceptor, plumbing and drainage are adequate or can be installed.
- Gas and electrical capacity support the kitchen equipment.
- Building permits for the fit-out, and the timeline to obtain them.
- Business licensing: each GTA municipality has its own licensing requirements for food establishments, and public health inspection applies. Liquor licensing, if needed, is a separate provincial process.
- Patios on public sidewalks or private property have their own municipal approvals.
Requirements change and differ by municipality, so confirm directly with the municipality and qualified professionals.
Other clauses worth understanding
- Landlord's work vs. tenant's work: who builds what, to what standard, before possession.
- Fixturing period & inducements: time to build out before rent starts, and any landlord contributions.
- Term, renewal options & rent on renewal.
- Assignment & subletting: your ability to sell the business or transfer the lease.
- Relocation & demolition clauses: landlord rights to move or terminate tenants for redevelopment.
- Radius restrictions: limits on opening another location nearby.
- Continuous operation & hours: obligations to stay open.
- Personal guarantees, deposits & indemnities.