Effective Strategies for Finding Buyers for Retail Shopping Centres: A Guide for Commercial Real Estate Agents

Some investors find retail properties attractive investments. However, this property class requires a unique understanding and shaping as an investment. Retail properties are ‘busy’ locations, and their operational costs are typically higher than those of other investment property classes.

To shape and improve a retail property, factors of investigation and change occur in categories such as the tenant mix, income creation, marketing to attract customers, and lease documentation. The ‘tenant mix’ refers to the variety of tenants in a retail property, which can significantly impact its attractiveness to potential buyers.

A diverse tenant mix can attract a broader customer base, increasing the property’s value. Then, you can add property maintenance to the investigations and activities.

Suppose you are looking to attract buyers for retail property to your brokerage as part of creating negotiations or transaction sales. In that case, the following list will help you cover the main points or strategies.

Deep Understanding of the Buyer Profiles for Retail Shopping Centres

As a sales agent in the retail property market, it’s crucial to understand who might be interested in buying your retail property and why it’s an attractive investment. The property market constantly evolves, and adapting to these changes is essential. Retail properties sell to experienced and investment-wise investors.

Different investors are interested in retail properties, typically institutional investors, private investors, and REITs. Some will hold retail property as part of an investment portfolio. Those reasons are usually one or more of the following:

• Income generation from the tenant mix and associated leasing strategies
• Value-add opportunities with the given property in its location
• Diversification or expansion of the property
• Property upgrade opportunities

So, when looking at a retail property for sale, consider those three factors and how they may apply to the property in its location. Knowing the ‘upside’ for a retail property buyer with any shopping centre makes the marketing process much more manageable.

You can sell some shopping centres and retail properties “off the market” by simply matching people to property situations. Your database of contacts will prove useful in this situation. Track people and track their property requirements.

As an agent, your database is a valuable foundation of ongoing business, so spend plenty of time each day connecting to the people in your database and adding new people to the list. Conversations create new business, and that is a fact that you cannot ignore in brokerage activities today.

Maximise Leveraging Market Data and Research

Market data and research are powerful tools for finding local and regional retail properties and potential buyers. By remaining deeply systemised and engaging with a wide range of people about their current property situations and plans, you can gain valuable insights and make informed decisions.

1. Watch the local and regional market trends to identify property owners and buyers. You can copy articles about recent sales from your town or region’s newspaper for future use as comparables or in client discussions. Third-party evidence like that will support your client presentations, discussions, and findings. It is also helpful to copy that type of evidence into a notetaking system, such as OneNote, which aids data retrieval and reference when needed.
2. Identify the significant successful businesses and resource groups that drive the economy in your town or city. They will impact the population changes in both growth and demographics. Those elements will be a valuable part of your retail property assessments. You can build graphs and statistics charts from those demographic assessments to predict or display shopping centre customer behaviours.
3. Retail property buyers are interested in the facts of the property today and how things could change. Therefore, compile an accurate set of rental or income streams and the associated tenant mix details. Understand any property vacancies and establish an opinion on potential leasing.
4. Find out where all the ‘competing’ retail properties are located; visit those properties frequently to decide why they are successful and how that happens. Are there things that you can replicate in your retail investment properties?

Networking Shopping Centre Buyers

There are different ways to connect and get involved in the shopping centre buying and selling cycles; building a system around that is a good idea. Here are some ideas for that:

1. Build your database from connections and conversations. The groups to connect with will be investment groups, private equity firms, and high-net-worth individuals. As you talk to those people, divide their property requirements into locations, budgets, types of retail properties, and timing. Typically, those individuals will know about the advantages and ways of investing in retail properties, so to engage with them, you will need to talk from a knowledgeable perspective. Build your retail property knowledge and use it in all conversations.
2. Note any property changes and media releases online or in newspapers. Please maintain copies of these releases, as they will be useful in your discussions with property owners when listing or presenting your ideas.
3. Research the owners of the shopping centres in your location. Set a target of finding a few owners per day; whilst that may seem a ‘low’ target, some property owners require considerable research and investigation.

Digital Marketing Platforms

Use portals and platforms for prospecting and client contact strategies as the world becomes more digital. Let the search engines see your name and real estate activities, news releases, articles, and updates.

You can optimise every online document or promotion using keywords that focus on the property type and location. Advertised listings should follow the same strategy. You can link anything online to social media and vice versa. LinkedIn is the leading social media channel many agents and brokerages use in commercial real estate.

Suppose you have some skill in writing and creating relevant online real estate content. In that case, you can post articles to your social media channels and perhaps start a personal website that features property facts and changes in your local market. Use your real estate specialisation as a base for supplying information to those online platforms.

Create Targeted Marketing Campaigns

Design direct marketing campaigns for the retail properties on your listing books. Distribute these marketing campaigns to qualified individuals who receive regular updates about property changes and activities in the location. Every email marketing campaign can be specific to the classes of retail property and the area. This can simplify the process of converting leads into conversations and inspections.

The email marketing approach works very well with potential buyers and shows other retail property owners that you are an expert in the property class in the location. Use direct email marketing as a marketing tool at least once a month.

Another option to consider is the different types of retail property investors, their respective budgets, and the preferred size of retail property. You will need a suitably segmented and updated database to service that level of detail. Always keep your database up-to-date through constant contact and daily conversations.

Engage with Other Specialist Retail Property Brokers

If retail property is to be your speciality, he will soon know and see other brokers and agents who specialise similarly. Build relationships with other excellent agents in the industry who understand retail and actively buy and sell properties for their clients.

Interestingly, retail property leasing and sales are closely allied activities. Sales agents often get involved in shopping centres’ more significant lease requirements to ensure that the property is suitably placed and optimised through leasing for potential shopping centre sales when the time comes.

Assessing Property Values

There are different ways to assess the value of a retail property or shopping centre. Depending on market circumstances and property market conditions, some approaches to valuing or appraising a property will differ. The value outcomes will also vary depending on the appraisal method you choose.

Selling a retail property as a future development site can create unique values and sales circumstances. Comparatively, we can value the same shopping centre by capitalising the yield from the passing income stream.

Both sale methods will likely give different values in the current market at any given time. So the question is, what method of sale should you use for any given retail property at the time of potential sale? That is where the expertise of a retail investment specialising agent can provide genuine service and guidance.