In any retail property today there will be plenty of issues and pressures impacting occupancy. Landlords typically want to minimise the impact of vacancies and the tenants want to have a successful occupancy where they can improve business results and sales. It stands to reason that there are some specialised tenant mix leasing services that can be provided here by experienced property leasing agents.
Your Retail Competitors?
There are plenty of agents in most towns or cities claiming to provide high quality leasing services; unfortunately most of them do not understand the bigger picture of shopping centre performance and how important it is to select the right tenants to fit into a property vacancy. There are many things to be looked at in balance given the prevailing occupancy situation, customer requirements, and the surrounding current tenant profiles.
Your Retail Services?
Specialised retail tenant mix services are a valuable addition to any retail leasing and or shopping centre management service and process. Here are some ideas to help you establish this strategy in your brokerage:
- Matching the right tenants to the greater property mix – Sometimes in a single property you can too many tenants of one type (e.g. fashion) and not enough tenants of another (perhaps food etc.). There is also real value in looking at the best tenants in the mix and identifying what factors create that success.
- Clustering programs – You can set about finding groups of tenants by type that are likely to make a zone of a shopping centre more vibrant and active from a sales and customer perspective.
- Finding the best tenants within merchandise categories – You may want to attract a food retailer (eg Coffee and Cake) to put into a vacancy, however the real decision will be as to which retailer or franchise tenant you should seek out and attract. Some will be better than others.
- Lease documentation recommendations – Property people generally know more about the property and the leasing situation than the legal person putting the lease together. There is some real value you can add to the leasing documentation with the correct conditions that you believe reflect the factors of property design and layout.
- Tenant marketing programs to boost sales – A good retail property will usually have a comprehensive marketing program established to support sales and customer attraction.
- Tenant retention programs – The message here is that you can determine just who your good tenants are in a retail property and set about retaining them for the future in a structured long term occupancy deal. The lease terms and conditions offered to a good tenant are likely to be more attractive than those offered to a new tenant or a weak tenant in occupancy.
- Renovation and relocation initiatives – It is a known fact that the renovation requirements in retail property today are high when compared to office property. Levels of presentation and cleaning in retail are always important to attract people back to the property to shop and purchase goods from the tenants in the tenant mix. A retail property can age quickly if many people visit it regularly. To prevent sales and customer slow down it pays to put in place a renovation and relocation initiative or plan where the property can be improved in a planned and relevant way over time whilst continuing to trade.
- Improving market rentals – The levels of rent charged in retail will shift based on the business type, the property, the outgoings, and the landlord investment targets. All things should be looked at in balance. Market rents will be determined through a process of balance. If you know a lot about competing properties and the local area, you can help landlords set about improving market rentals over time and hence the investment strategies for the property.
- Customer surveys – Get to know what customers expect and want from a local shopping centre. Undertake regular surveys from customers locally. Do so at different times of the year and on different days of the week. In that way you will capture the ideas and preferences of most shoppers, and then know what they are wanting from the property to satisfy their weekly shopping plans.
When you look at these things, you can see why retail shopping centre management and leasing is a very special part of the property industry. There are many ways in which you can add value to the tenant mix performance of any retail property for the landlords that you serve.