When you manage a retail property there are a lot of things going on that need control and communication back to the landlord. That is where a good reporting system will help you greatly as a centre manager.
It is no secret that the retail property market can be a challenge at the moment with a significant shift between retail sales on the internet, versus retail sales in the shop. It is the retailer that suffers the downturn in trade, and as a consequence they must revisit their product and service offering. If they cannot make a go of it, then a distressed tenant soon turns into a vacant tenancy. The landlord then suffers in loss of income.
Today more than ever before there is a strong bond between tenants, customer, landlord, and property manager. The balance and success of a shopping centre sits in between all of them. They all have a vested interest to make a retail property work and perform as an investment.
Whilst it is nice to have a tenant and a lease for retail shop premises, a vacant tenancy is a waste of time and energy for all concerned. It is in the landlord’s best interest to help a tenant succeed in a retail shopping centre. The link between the two parties is the property manager. A good property manager knows how to help a property thrive and grow as an investment; they also know how to assist a distressed tenant get back on track with sales and customer numbers.
To keep the landlord fully briefed on the performance of a retail property, the monthly reporting system needs to be comprehensive and advanced. Here are some of the big topics to help you structure and provide a monthly report to your landlord client.
- Tenant mix activity should always be tracked. That will include the changes in a property and the upcoming lease activities.
- Lease rent reviews and lease options coming up should be planned and actioned early. Do not leave these things to the last minute. Many a landlord or property manager has been taken by surprise when it comes to a lease document that they did not fully understand.
- Tenant renovation will always be a priority in retail shopping and shopping centres. A shop that looks poorly for any reason will deter customers not just for that particular tenant, but also for those other tenants that are nearby.
- Maintenance in the property will occur for both planned and unexpected events. You must report on maintenance budget activity and results each month.
- Sales by tenant category and by tenant will give the landlord an indication of just what tenants are successful and those that are struggling. Trend these numbers in a graph so you can see what is going on in the property.
- Vacancy marketing will always be important to minimise the impact of loss of rent. Any existing or upcoming vacancy should be comprehensively marketed to attract new tenants to the property.
- Centre marketing to the local community will help with sales for each tenant. There should be a marketing fund for this process. The tenants lease should allow contribution by each tenant to the marketing fund.
- Income and expenditure will be updated each month for the property. In an ideal world the income and expenditure should track closely to budget; that being said, there will always be challenges that need resolve and management.
If you manage larger retail properties, then this list will get larger and deeper. Control will allow you as the property manager to keep the property on track as a retail property investment.