Encyclopedia
Go-dark clause
A lease clause that lets a tenant stop operating while still paying rent.
For example: Hypothetical: a retailer closes but keeps paying rent under a go-dark right. (Illustration only, not a real deal.)
This is a general industry term with no single official definition. Your lease or contract wording controls.
Example only, not a real client. Say you run a restaurant in a retail centre and business slows. You want to close while you look for a buyer, but your lease requires you to stay open during set hours. We review the clause and the risks before you make any decision.
What I’d tell a friend
Check whether your lease lets you stop operating while still paying rent. Closing without that right can put you in default.
Why it matters to you
It may let an anchor stop operating while still paying rent. That can hurt traffic for every tenant around it.
How to use it in your deal
Landlords should be careful about granting go-dark rights to anchors, since a dark anchor hurts other tenants and may trigger co-tenancy clauses. If granted, consider a recapture right so you can take back the space and re-lease it. Tenants with go-dark rights get flexibility if the location underperforms.
Smaller tenants should check whether their lease has co-tenancy protection if an anchor closes. Buyers should review anchor leases closely; a dark anchor can lower values even if rent is still paid. Courts in Canada have sometimes been reluctant to force tenants to operate, so landlords may be limited to damages. Ask about operating hours and what counts as operating. Look for notice requirements before going dark.
If you're a smaller tenant, ask the landlord directly whether any anchor has this right; the answer tells you a lot about the plaza's future. Lenders often look for continuous operation covenants in major leases, so this clause can affect financing too.
Mistakes I see
Not knowing anchors can go dark. Missing recapture rights. Ignoring co-tenancy effects.
In BC and Vancouver
Lease terms govern; case law on continuous operation is on CanLII.
Official sources: CanLII (court decisions) · Commercial Tenancy Act (BC Laws)
What it means
Going dark means closing your business while still holding the lease. Some leases require continuous operation, especially in retail centres where an empty store affects others.
A go-dark clause, where present, sets out whether you may close and what the landlord can do in response, such as taking back the space.
What to check
Look for an operating covenant, set hours and any landlord right to end the lease if you close.
Talk with a BC lawyer before closing, since the consequences depend on the wording.
Questions to ask before you sign
- Can the tenant go dark?
- Is there a recapture right?
- Does co-tenancy apply?
- What notice is needed?
Why landlords keep a terminate-and-re-let right
A go-dark right lets a tenant stop operating while still paying rent. Landlords usually insist on a matching right to terminate and re-let, otherwise a dark box can hurt neighbouring tenants and the centre’s income story.
If you are the tenant, read continuous-operation and co-tenancy clauses beside go-dark. They interact. If you are the landlord, do not grant go-dark without a clear claw-back.
Your lawyer should tie the clause to notice, salvage, and what happens to exclusive-use rights when the lights are off.
Keep reading
Related terms: Co-tenancy, Anchor tenant, Permitted use
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General information for British Columbia only. It isn’t legal, tax, accounting or financial advice, laws and rates change, and reading it doesn’t make you my client. Any numbers or scenarios are hypothetical. Check the linked official source and talk to a lawyer, accountant or other qualified professional before you act or sign anything. See the terms and disclaimer.