When you have a retail property to lease, there are some important pieces of information that you will need to build a leasing strategy and any marketing process. Gather the facts before you take steps towards lease marketing or lease negotiation.
Retail Property performance will vary substantially from location to location and city to city. It is therefore very hard to compare retail properties in diverse locations. You must know your market in a comprehensive way. Here are some tips to help you with gathering the right facts relative to leasing any retail vacancy:
- Occupancy costs need to be assessed relative to the vacancy. Occupancy costs will include rental, outgoings, and other sundry charges that apply to leasing and the vacant space. Any tenant will question the costs and understand the viability of the business to apply in the location. Occupancy costs and the ability to make sales will vary by location in the property, and by the type of tenant. This then says that there is a difference in sales and turnover capability between tenant types; they also have differing profit margins.
- New tenants to a property will be concerned with premises location and its proximity to other successful tenants. That’s where clustering becomes an issue in a retail property. A cluster of tenants can extend the interest and purchase potential of the shopper. Understand the adjacent leases and just when they will be expiring. Is there an intention to find other tenants for those locations?
- The anchor tenant or tenants in a property are an important draw card for brining customers to the shopping centre. The anchor tenant lease should be watched for stability and longevity.
- Rental types and market rentals will vary according to location and market interest. You should check out the rentals and vacancy factors in nearby retail properties. That will help you understand the factors of attraction that apply to finding any new tenant.
- What would you consider as the typical demographic shopper profile for the property? That shopper profile will impact the tenant mix and choice of tenant. Choose your tenants wisely.
- Improvements in the tenancy area and landlords works may vary subject to the lease negotiation. Understand what the landlord is prepared to do in the premises to attract a good tenant.
- The sales averages for the property or MAT (Moving Annual Turnover) will be of interest to any new potential tenant as will the customer counts for the property. Get those facts and understand how they can provide leverage in leasing any new vacancy.
- Lease incentives could apply to attract a tenant to the property. Those lease incentives will be impacted by market conditions, other properties, vacancy rates, and current business sentiment. The lease incentives offered to a new tenant will be different and larger than those offered to a sitting tenant considering a new lease in situ.
So these factors will give you a good start to solve the leasing challenge in the property. Get the facts together before you start lease marketing and property inspections.