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Big Tips in Tenant Mix Analysis for Commercial Real Estate Agents

When it comes to leasing and managing a retail property today, the tenant mix strategy and analysis process becomes critical to rental stability and minimising the vacancy factor in the property.  Given that this property market is under some pressure currently, you as the leasing manager or property manager need to protect your tenancy mix and the income that comes from it.

A good tenancy mix will reflect in the stability and growth of trade for the smaller tenants in the retail property or shopping centre.  That being said, you still need to have the right tenants in the property that satisfy the needs of customers.

Here are some ideas to help you with improving the tenancy profile across your property.

  1. Maintain close business relationships with all of your tenants.  When it comes to managing or leasing a retail property, you should be meeting your tenants quite regularly; that will usually be two or three times a month.  Retail tenants are quite volatile and will react quickly if sales are down or the property is performing poorly.
  2. Understand the leases as they relate to each tenancy.  That will include rent reviews, lease expiry dates, lease renewal options, make good provisions, outgoings recovery, and other critical terms and conditions.  Make sure that all of these issues are correctly captured into a diary based software program that can tell you well in advance of the actions that you need to take.  As a general rule, any issues that are to occur inside the next 12 months should be commence early.  In this way you will be well prepared for protracted and slow negotiations if they are to occur.
  3. Understand what the customers are looking for when it comes to visiting your property.  The best way to do this is through some survey process on the property over a period of two weeks each quarter.  You will then get a reasonable idea of shopping needs, and customer requirements.  You will also identify the weaknesses in the property that can be addressed before they have impact on sales.  It is a fact that retail shopping patterns are changing, however they will not disappear.  You simply need to adjust your tenancy mix over time to suit the requirements of today’s trends in retail marketing.
  4. Develop a series of clusters within your tenancy mix.  These clusters should be comprised of specially selected tenants that complement the retail offering of each tenant nearby.  A customer can then move from one shop to another as they purchase goods.  You can also choose tenancies for your cluster that retain the customer’s interest in the property and the location.  A coffee type tenant in a cluster will extend the shopping potential of the customer in the cluster zone.
  5. Within the property you are likely to have one or more anchor tenants.  They should have been chosen for their relevancy to the surrounding customer demographic.  You can then position the specialty tenants and the clusters based on the location of the anchor tenants.
  6. It is interesting to note the different shopping habits between males and females.  Generally speaking the shopping patterns of females is far more complex to that of males.  A female spend far more time in the property moving from shop to shop and looking at many different things.  A male will generally go to the property to purchase one or two things and then leave.

It is a fact that customers expect a vibrant property when they visit.  This will include presentation, other customers, and great tenants.  For all of these reasons, you will need to balance your tenancy mix accordingly.

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Shopping Centre Managers – How to Get the Retail Tenant Mix Right

When it comes to leasing and managing a retail property today, the tenant mix is critical to the income that you create.  Without a successful tenant mix, the investment performance for the property owner will be difficult to achieve.

In a retail property today, there are just so many things to be carefully balanced; that is because of the prevailing economic conditions and the property market pressures locally.  At this current time and in most locations, it can be difficult to find the right tenants to fill vacancies.  It is also hard to keep the tenants in the property.

For this very reason, a tenant retention plan and a vacancy leasing strategy should be adopted by all agents in serving their clients.  These elements should form part of the business plan for every investment property under management.  Top clients need a top property management and leasing service, and that is what this process can do.

All of this being said, as professional commercial and retail property leasing experts and property managers, it is up to us to bring the required experience and knowledge to the landlords that we serve.  Special skills are required when it comes to tenancy analysis, and tenancy mix strategy.  These special skills also command a fair and reasonable fee for service.  Discounts do not apply for a top service in our industry!

The placement of a tenant is simply not a matter of just leasing, negotiating, and occupancy creation.  It is a matter of finding the right tenant for the right property, and matching the lease back to the requirements of the landlord’s investment strategies.  The age of the property will also have some influence on the leasing process given the requirements of refurbishment and tenancy relocation.

Here are some factors to merge into your property leasing strategy and tenancy mix.

  1. Get to know all of the tenants in the particular subject property.  A close working relationship with them will help you identify any pressures of occupancy or rental payment.  With the property market today, as difficult as it currently is, it is better to retain tenants in occupancy through good lease management procedures, than to lose them to another property where incentives or rental adjustments may be more attractive and the landlord is more flexible.  Understand that many other real estate agents will be chasing your tenants as a natural course of business.  Your property package needs to be competitive in the local property market.
  2. The factors of supply and demand will apply to your property type and the local area.  Those factors will also influence market rentals, incentives, and vacancy factors.  Every landlord needs to be updated regards the trends of the local property market so that sensible leasing decisions can be achieved.  An extended vacancy and loss of rent is far more damaging to a property than a startup lease with a lower rental.
  3. Check out all of the major properties locally that could be considered as competitors to your subject property.  Review their tenancy mix and vacancy factors.  Look for the strengths and weaknesses that apply to each particular property.  If possible, get details of the current market rentals and the upcoming vacancies in each property.  With this information, you can influence some of those tenants towards your landlord’s property.

A very skillful commercial or retail leasing expert knows how to balance all of these things for the clients that they serve.  Create a tenant retention plan and a tenant communication strategy to strengthen the overall lease profile of the property for the landlord.  That is what leasing and property management is all about.  In one word you could say it is the creation of ‘stability’.

If you want more tips on tenant mix and tenant retention, you can get them at our main website http://commercial-realestate-training.com/

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Commercial Agents – Thinking Through and Planning Your Tenant Mix

When it comes to managing and leasing commercial or retail property, the tenancy mix will always have priority when it comes to the overall strategy and the function of the property.  Every significant and important retail or commercial property should have a tenant mix plan and a tenant retention plan.

When these plans are established, you can optimise the performance of the property in the directions that the landlord requires.  It is no secret that the property market is under some pressure at the moment.  Global economic trends, retail shopping, and business sentiment all place pressure on property performance and tenant occupancy.

Here are some tips that can be applied to your overall tenancy mix strategy.  As a commercial or retail property leasing expert, these factors should be structured into your services and specialisation.

  1. The best tenants should be identified in each and every property that you manage or lease.  Those tenants should be given specific focus and attention when it comes to lease occupancy requirements.  It is wise to meet with these tenants on a monthly basis to ensure that you know their intentions and any pressures that may be applying to the business currently.
  2. Lease terms and conditions will vary by property type, landlord, and location.  In some circumstances, there are specific terms and conditions that should apply to the arrangements between landlords and tenants.  As the leasing expert, you should know what those terms and conditions are, and give guidance to the landlord as appropriate when they are in negotiation with a new tenant.
  3. Anchor tenants are an important component of property function for many reasons.  Most importantly, they will pay the majority of the rent for the landlord.  That being said, the anchor tenant also provides stability for the image and function of the property.  Any specialty tenants in the property will build their business around the activities of the anchor tenant.  Make sure you understand the lease intentions of the anchor tenant and the current trading situations.
  4. Specialty tenants should be chosen for their property offering and retail offering.  Specialty tenants will be selected for the best position within the property that suits their business needs and services.  Stay close to your specialty tenants as part of the lease management system and overall property strategy.
  5. Market rental will change from time to time based on the local market property activity.  You need to know what the changes are when it comes to rental and how the rental will be impacted by the supply and demand for future premises and occupancy.  The market rental can be either gross or net, and incentives will have impact on the rental.
  6. Understand the factors of outgoings costs that apply to a property type.  For any property to be successfully least, the outgoings should be within standards that are acceptable for the property type and the location.  Most tenants will avoid any property that has high outgoings.
  7. Competing properties and any new property developments should be understood for the pressures they apply to your subject property.  Inspect any other properties locally that have interaction with your customer base.  Look for any changes in their tenancy mix or product offering that could pull customers towards their tenants.
  8. Landlord investment intentions will change from time to time.  Those intentions will have impact on the leases that you negotiate.  Be aware of the landlords intentions so that you can adjust your negotiations in any upcoming lease situation.
  9. Property age will have impact on property refurbishment and renovation.  The tenants in the property will need to be moved around that activity and the leases may even require renovation and relocation clauses as part of lease negotiation.  Consider the factors involved, and the legalities of using these courses as part of lease occupancy.  When it comes to retail tenancies, some special terms and conditions may be required has to advice and timeframe.

Every property will improve when you develop a strategy for the tenancy mix and the tenant retention plan.  To those points above, you can add factors of location, and property type.  In this way you can be seen as the property leasing expert that landlords require.