Revitalizing Neighborhood Shopping Centers Part IIby: Confilabs
In Part I of Revitalizing Neighborhood Shopping Centers we addressed flexibility in leasing and marketing low-traffic properties. Next we turn our attention to targeting new service oriented tenants and social media outreach.
Service tenants like dry cleaners, hair and nail salons, convenience stores, small medical service providers like chiropractors and dentists, restaurants, financial and insurance companies are ideal for small neighborhood shopping centers. All such service tenants are looking for the same benefits of easy access for their clients, good parking ratios and complementary businesses as neighbors. They also want strong traffic counts, high foot traffic and good visibility in a location.
Ideally a small neighborhood shopping center should have an anchor, a national tenant with name or brand recognition. Such name recognition attracts more customers and other tenants to the shopping center. But this isn’t always the case in smaller neighborhood retail centers. Local mom-and-pop businesses typically fill these storefronts. It’s important for property owners to recognize that it can be impossible for hair or nail salons to create enough income to pay the rent. This is why many landlords are reducing the rent so their tenants can make a living while also making sure the space they occupy makes sense. It also helps tenants to grow their business so they can afford to pay more in rent later.
And landlords don’t have to look as far for prospective tenants as they might think. By simply looking around at in-market prospects and finding what it will take to make them move vacancies are filled much more quickly. Landlords with a competitive edge often buy out a prospective tenant’s lease for long-term deals at above-market rates. When prospective tenants are shown what they can accomplish in sales they are more likely to move. Experienced commercial real estate brokers often ask such prospective tenants if it would be worth paying 5 percent more in rent if they could do 15 percent more in sales. In many cases prospective tenants find it’s worth it to relocate.
But relocating prospective tenants requires landlords to pay extra attention to certain property details like parking lot upkeep, landscaping and signage. Swaying prospects means being more in touch with tenants’ needs, brighter, cleaner and cheaper than the other guys. Landlords will also want to check into the big picture to see why a prospective tenant wants to relocate. In some cases it may be due to declining sales, corporate relocation mandates or problems with their current location. But it’s best to know the motivation behind a tenant wanting to relocate.
In addition to targeting service oriented tenants landlords shouldn’t underestimate the power of social media outreach. Mega retailers like Target and Walmart have amassed nearly 6 million and 7.9 million fans on Facebook besides their own home pages. But you don’t have to be big to use a similar strategy and many landlords are creating awareness for their properties through Facebook, Twitter and other forms of social media. Landlords are working with their tenants to post special promotions and discount sales in real time on Facebook and Twitter. Uploading the season’s latest menu for your restaurant and even a video can maximize your restaurant tenant’s presence in your local community. And the great part about most social media outreach is that it’s free making it all the more reason to take advantage of these marketing tools.
When it comes to revitalizing neighborhood shopping centers flexibility in leasing, on-site marketing, targeting prospective service oriented tenants and social media outreach are effective strategies.