What does a non-compete clause in a lease typically entail?

A non-compete clause in a lease primarily includes a restriction on the tenant, preventing them from operating a business that directly competes with the landlord's business or other specified businesses within a certain geographical area. This clause serves to protect the landlord’s investment by ensuring that tenants do not undermine each other's profitability through direct competition.

For example, in a retail leasing situation, if a tenant operates a coffee shop, a non-compete clause might prevent them from opening another coffee shop or using the leased space to run a business that sells similar products in the same center or vicinity. The intention behind such a clause is to maintain a balanced and profitable business environment for all parties involved.