Shopping centres are complex property investment models. They require understanding and commitment on the part of the property owner and the property manager. As part of operating a shopping centre there are factors of renovation and presentation to consider and merge into the property business plan and tenant mix strategy. Failure to do so will see pressures occurring with the tenancy mix, customer sales, and market rentals.
It is a fact that the presentation and convenience of a shopping centre will make or break the performance of the property for the tenants and the landlord. It is therefore necessary to create a renovation strategy and ongoing maintenance plan for your shopping centre.
Any moderately successful shopping centre will have many hundreds if not thousands of people moving through it every day. That then places pressures within the property on the common area, overall presentation, car parking, access, and the tenancy mix. Any areas that the customer moves through need to be clean, attractive, and functional.
People shop for different reasons. Your property will serve a variety of needs for the community and the customers. The tenancy mix needs to match those needs in a convenient and comfortable way.
So what areas need to be renovated in your property today? How long has it been since the property was renovated? To answer these valuable questions it is time to have a serious look at your shopping centre and the demands of customers and tenants.
Consider the following questions and areas within the shopping centre:
- Start your review from the driveway entrances to the property. The entrance ways need to be well signed, and convenient. Look at how the surrounding roads and highways feed people to your property. Look for any factors of confusion that could arise from missing signage or poorly marked traffic ways.
- The entrances to the property should be well kept and clean. Any garden areas adjacent to the entrance ways should be well manicured.
- The car parks should be functional and convenient. At different times of the day and on different days of the week there will be pressures on parking. Do a survey to understand those peak times of car park usage.
- Given that people move from the car park to the property entrance way, look at the factors of safety and signage that will help people understand how to move into the retail shopping area.
- The doors and the entrances to the shopping centre should be branded with the shopping centre name and Logos. Your best tenants should be positioned adjacent to the entrance ways and as a consequence be paying a higher rental. Those tenancies should also be optimised for presentation and product offering.
- The malls and the common areas within the property should be well cared for and cleaned. Shopping centre presentation should be of the highest quality at all times. Customers will not come back to a property that they are uncomfortable visiting.
- Look at the security aspects through the common areas and the surrounding car parks. Any threats need to be removed through specific security solutions. Be aware of the problems presented from the surrounding demographic and customer profile.
- The shops should have a renovation requirement as part of their lease structure and the terms and conditions of occupancy. It is not unusual to enforce the renovation of a tenant shop or premises every four years of the lease term. Naturally, this has to be negotiated at the time of lease take up.
- The landlord for the property should be maintaining the common area presentation and overall property appearance. A regular renovation programme should be implemented in an ongoing way to the inside and the outside of the shopping centre. The costs of doing that will need to be merged into the property business plan and the outgoings budget.
So there are plenty of things to do here when it comes to shopping centre presentation. The tenants within a retail property pay a significantly higher rental in any occupied area, when compared to office or showroom bulky goods properties. As part of that higher rental and occupancy process, the shopping centre or retail property needs to present well at all times, and attract customers to purchase goods and services, and to come back on a regular basis. That is why the renovation programme is so important to ongoing retail property performance.