Canadian Lawyer - sample

20 M A R C H 2 0 1 9 w w w . c a n a d i a n l a w y e r m a g . c o m D espite the increasing popularity of online sales, the continued need for a tactile, hands-on shopping experience has led to the increasing popularity of pop-up shops in both malls and street- front spaces. The temporary nature of these pop-ups means that the legal relationship between the landlord and the pop-up tenant can more easily be secured through a licensing agreement instead of a detailed lease. "It's the market's response to online shopping," says Jake Ruddy, whose real estate development practice with Nelligan O'Brien Payne LLP in Ottawa focuses primarily on shared property and mixed-use developments. He senses that people still want to see, feel and touch products and interact with com- pany representatives as they shop, allowing the merchandiser or promoter to put products in front of the buyer to help to drive more market share. "Shops that are entirely online are not accessing the entirety of the market and I think they realize that." In recent years, there's been a drive for some sort of physical presence, often of a temporary nature. And these short-term shops — so-called pop-ups — are used not just for sales but also to introduce startups with new items and concepts and to promote products, ideas and events. And it's everything from the mom-and-pop shop looking to test the waters with a temporary location to international brands wanting to create some excitement over a new product. POP-UP LEGALITIES Temporary shops are increasing in popularity, requiring new types of contracts By Marg. Bruineman R E A L E S T A T E That has given the retail landlord more opportunities to fill otherwise empty space. The temporary offering might also bring more people to the area attracted by the pop-up hype. Some landlords have converted larger spaces to allow for small or temporary shops creating retail or food halls, like booths one might find at a convention. The Retail Council of Canada highlighted the trend toward pop-ups in its 2017 study of the country's shopping centres. It found tem- porary retail is becoming more common in Canadian malls. And while the not-for-profit organization that represents 45,000 business- es and merchants doesn't typically represent temporary tenants, there is recognition that pop-up shops can be a boost to the sector overall, says Karl Littler, senior vice president of public affairs. "We're happy to see retail entities thriving, even if these are short-term ones or pilots, that might lead to longer-term retail offerings," says Littler, a lawyer. They also help to retain exist- ing retail stock, preventing space from being converted to other uses. However, he thinks it's important for temporary businesses to properly distinguish the terms of their services and prod- ucts because they may not provide the full retail experience, such as allowing returns. There are also no guarantees that permanent retail busi- nesses are going to operate in perpetuity. "We're hopeful that they'll thrive and they'll become JEANNIE PHAN

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