The commercial and retail property market has changed a lot over the last couple of years. The retail property segment has particularly come under some pressure from escalations in small business operating costs, and reduction in retail sales. The internet has impacted the way many people buy retail goods and that flows through to the way retailers can trade and sell.
Somewhere in amongst all this is the shopping centre owner that is offering a quality property to the tenant mix and the local retail customers. So how does all this balance out?
The reality of today’s retail property market is that it will not disappear, it is just changing. Retailers will still require premises into the future, albeit that some of those retailers will change or may operate their businesses differently. Customers still like to ‘shop’ and ‘feel good’ in the process; shopping centres serve that need.
A successful retail property or shopping centre is a mixture of stakeholders that all work together in achieving a balance of vested interests. The stakeholders are:
- The landlord
- Specialty tenants
- Anchor tenants
- Community groups
- Municipal councils
- Local businesses
- Property Managers
- Leasing Managers
The last group on the list is perhaps the one best placed to make the ‘retail property equation’ work productively for all. It is the leasing manager that can stay in contact with the market and all the changes that are occurring. It is the leasing manager that can balance all the facts of this property market to achieve a viable tenant occupancy and long term lease.
I like to remind landlords today that it is not the starting rent of a lease that is really important in a lease negotiation; it is where you will head with your market rental over the lease term. That is where the leasing executive can add real value in structuring a lease that works for all parties and with something that helps reduce the vacancy factor in the property. Rent reviews, lease options, renovation obligations, permitted use, and relocation provisions all offer some factors of strategy. We also know (or should know) how to market and position a retail property for optimising the lease enquiry.
As the retail property market changes, we as specialist real estate agents are very well placed to offer the right strategy and ideas to make a lease deal work. That is a high value offering to the landlords in our property markets. We sometimes forget that we really are the property specialists and know much more about putting a lease deal together than the clients that we serve.
If you are struggling with your market share or marketing efforts, take a look at the value that you provide your clients and property owners. Lift your expertise and relevance to a new level so you really are better than the other agents in the local area (in most cases that is not too hard to achieve!).
When any commercial or retail property market is going through change it is the time for us as agents to lift our value and focus to help the clients that need us. Market yourself as the property expert; help people solve property problems. Opportunity awaits the specialist property agent.