When you manage or lease a retail property or shopping centre, you will know that the tenant mix becomes critical to the performance of the property. When you get the mix just right, the customers visiting the property are happy and the tenants get more sales. That can only mean two things; a better rent for the landlord and lower vacancy factors.
So that is why we focus on a tenant mix and its balance within the property. The property manager, landlord, and the tenants all have an interest to make it work.
Here are some tips to help you do a ‘tenant mix analysis’ in your retail property:
Check out all other competing properties nearby as they will have some impact on your property mix. You will need to know if those properties are good or bad in property performance and tenant offering. Some of those competing properties will be looming large on the horizon as a competitor and possibly attracting your tenants into making a move away from your property. What makes the competing properties successful and how have they done their tenant mix? Who are the successful tenants for those properties and why is that? Are your customers the same group that visit the competing properties?
Understand the community surrounding your property and their shopping patterns. That will include days of the week, types of shoppers, spending patterns, and the reasons they come to your property.
Transport analysis to your property will include roads, buses, rail, and taxis. The question really is, ‘Just how do the majority of shoppers get to your property and when do they do that?
Traffic counters on the doors will help you understand how people enter the property and move through it. Read the counters frequently as you must know the days of the week and the times of the day where you have your shopping peaks.
Clusters of shops in your property may influence people to stay in a certain zone. ‘Food-courts’ are a case in point.
Common areas and walk ways will be used by the shoppers in particular ways. What have you got in your common areas that encourage the shoppers to extend their stay in the property?
The presentation of the property is a large factor in the success of the tenant mix. Customers know when a property looks good and is well maintained, and will return to the shopping centre because of that positive experience.
Destination shops will focus the foot traffic to the property. Understand where your destination tenants are, and if their customers stay in the property for other things and shopping.
Successful tenants will stand out in the property beyond other tenants. Why are they successful? Be very careful that you support their actions and strategies, as this will give you more customers to the property.
Sales results per shop and per group should be analysed on a monthly basis so you can see what tenant segments are more active than others. The analysis can also help you see poorly performing tenants in a group of good ones. You can then take the appropriate action to help the poor tenant improve.
Anchor tenants will be the real magnet that gets people to your property. Work closely with your anchor tenants throughout the term of their lease so you can connect their trade and customers to the other specialties in the same property.
You can add to this list and build on the tenant mix performance in your property. Most importantly the mix should be shaped and encouraged so you get the best outcome for all the stakeholders in the property.
If you want some more tips and ideas to help your commercial real estate agency and convert more opportunity into listings and commissions, you can get a free ebook of tips and tools at http://www.commercial-realestate-training.com
John Highman is an experienced Commercial Real Estate Agent, International Speaker, and Sales Coach.Share on Facebook