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Shell SA had a tricky problem: they had a very high volume petrol station in Cape Town’s Foreshore precinct that had a rebuilding clause hanging over it, jeopardizing their long-term occupancy of this valuable site. Indeed, potential purchasers of the property had indicated they would invoke the rebuilding clause in order to replace Shell with a higher paying tenant. 

In a complex deal Shell & Michael Schirnig negotiated a suspension of this rebuilding clause in exchange for a higher rental and Shell’s early vacation of under-performing premises at Cavendish Square. Both properties were held by the same landlord.

The slightly higher rental on the first set of premises, coupled with the opportunity to redevelop the Cavendish space 2 years earlier than expected secured the landlord’s agreement, while Shell has a top petrol station securely leased for the next fourteen years.

“Hooray for tenant activists,” says Shell’s Richard Jackson, “They’re long overdue.”

Go well, go Shell