When you work on retail property as an agent, you will soon see the need to specialise locally. There is a lot of difference in property performance when you compare retail property to office property and industrial property. The factors that drive rental, lease enquiry, and property performance are totally different.
If you choose to be a retail leasing specialist, it pays to have a comprehensive knowledge of the factors that drive retail property sales, and retail property performance. All of these factors are linked and impact the activities of the tenants, the tenancy mix, the landlord, and the property manager.
Retail leasing strategies today will vary from property type to property type and location to location. They are however underpinned by local market awareness. To help you with the local market awareness here are some tips and ideas that you can merge into your business activities.
- Get to know all of the franchise groups that are located in your region or those that could be located in your region. Franchise groups are greatly involved with retail property leasing and property performance. They bring a brand to the property that can have significant benefit to the overall tenancy mix. That being said, they have a specific need when it comes to finding the right property and occupying that property. In many cases they will bring a specific lease to the landlord as part of the lease negotiation. In those circumstances, it pays for the landlord to have an experienced property solicitor to help them with the adjustment of the franchise lease document to make it relative to the subject property.
- The competing retail properties in your local area will always have factors of change. That will include expansion, contraction, renovation, and refurbishment. All of these things can shift the tenancy mix and drive tenants to other locations. That will have impact on your particular subject property. As a specialist in the area, keep on top of the changes to the local area in both demographics and property availability.
- Most shopping centres will have one or more anchor tenants as part of the tenancy mix. Anchor tenants are very special when it comes to the future of the property and the attraction of specialty tenants to the shopping centre. On that basis, it pays to connect with the relevant and successful anchor tenants that could occupy medium to large retail properties. Anchor tenants may be department stores, supermarkets, or hardware stores. Given the size of the tenancy that they would occupy, the rental terms and conditions will be significantly different in circumstances to those that are offered to the smaller specialty tenants. In exchange for these differences, you would normally negotiate an extensive and comprehensive lease with the anchor tenant over a long lease term. That being said, the anchor tenant must be the tenant that you require to match the needs of the local shopping demographics and the tenancy mix.
- When it comes to retail property, there will always be alternatives of rental, lease terms, and occupancy conditions. They will include rental levels, rental types, fitout controls, refurbishment strategies, relocation strategies, and landlord investment requirements. Get to know the activities of all competing properties so you can bring that information into those retail properties owned by your clients.
A property person that specializes in retail leasing will be in regular contact with the local business community. It is this business community that provides the specialty tenants for your properties. As part of that process, you should also be contacting tenants in other competing properties in case they need to change location or expand their particular business.