Rhode Island has enacted legislation prohibiting grocers from using restrictive real estate covenants — clauses that prevent future tenants from operating competing grocery stores in the same location. The state follows Washington in banning a practice that legislators argue contributes to food deserts by locking communities out of grocery access even after a store closes or relocates.
These covenants have been a common but quietly controversial tool in retail real estate, allowing established grocers to effectively block competition in a given area for years or even decades after vacating a site. Critics say this can leave entire neighborhoods without food access, while defenders argue it protects investment and site development decisions.
As more states look at this issue, produce-forward retailers and regional chains expanding into underserved markets may find new real estate opportunities opening up in states that enact similar legislation — worth monitoring for expansion-minded operators.