Grocers Beware: Do Not Forget to Negotiate Your Pylon Sign Rights

The pylon sign is generally regarded as the large advertising sign located near the street intersections or main entrances to a shopping center.  The anchor tenant’s identification is permanently affixed at the top and, depending on the size and available space, some or all of the other tenants are listed on small individual panels below the anchor tenant.


Typically, on the lease term sheet or the first draft of the lease, the pylon sign language is missing, or it may be silent regarding the tenant’s rights to place the tenant’s name on a panel on the pylon sign near the entrance to the shopping center.  Many tenants expect placement on the sign, or may have received an oral commitment from the landlord’s broker.  This could be a significant deal point for the tenant since its success may depend on visible signage, due to the size of the shopping center.  For a non-destination tenant, signage helps customers to identify the tenant and the tenant’s counsel should immediately ascertain the client’s expectations and raise the signage issue in the initial negotiations.  If there is no meeting of the minds, counsel may save both parties significant time and expense by avoiding further negotiations by immediately identifying the landlord’s position on the signage.


Signage is probably one of the most critical components in the retailer’s success and the tenant must focus not only on the pylon sign, but also the signs on the exterior of the premises, particularly if the tenant has an identifiable or attractive logo that it wants to include on the premises exterior. 


Before signing any lease, the tenant must confirm that it has the right to an identification panel to be placed on the pylon sign, the size of that panel, as well as signage on the building facade.  Tenants must also look to its rights to advertise, including the name of the shopping center or the location in its tenant’s advertising and marketing materials.


Next, secure information on the tenant’s rights to use marquee-type signage for special saving opportunities, and other marketing opportunities.  Similarly, electronic reader boards are becoming more popular in shopping centers.  Verify the amount of slides on the reader board and the amount of slides the tenant will receive on the reader board.  Moreover, identify the programming practice from the landlord and what day of the week the tenant needs to get its programmable information to the property manager for programming on the reader board sign.


Lastly, on the signage issues, confirm shopping center rules and regulations on color, illumination, panel type signs versus individual letters, and, as always, all sign issues must be subject to village and municipal ordinances and approval.


If you have any questions on these or any other lease issues, do not hesitate to contact or call for a discussion on these important topics.