When you manage or rent a commercial property, it is important to maintain the success of the tenants and the property. The key to the process is the combination of tenants. If you get the tenant mix wrong, people won’t come to the property; Over time, the vacancy factor increases and rents become unstable. That’s the beginning of an income disaster for the property owner.
So it’s not just about having the right tenants in a property; there are some other factors to consider such as:
- Placement of tenants in and around the property.
- The time or hours the property trades
- The number of tenants in the property how
- The anchor tenant and their future occupancy intentions
- The reason why buyers come to the property
- Vacancy factors now and known to occur later
- Grouping of tenants in a pattern that works for a better shopping experience
Let’s look at the last item on the list for now. Bundling is essentially the process of placing tenants close to each other considering that customers buying from those tenants might buy from other nearby similar or complementary tenants.
When a customer is buying something, they are inclined to buy again relatively soon. Having tenants close to each other allows that trend to occur. For that reason, you can create a ‘cluster’. This is an example of a successful cluster:
- fashion for ladies
- Women shoes
- Jeweler’s
- Fragrance
- sportswear for ladies
All of these stores would work quite well in the same area or group. The group could be placed next to the main tenant of the department store.
When you get a perfect pool, you can look to introduce alternative tenants to the area who can encourage buyers to stay in the common area around the pool and buy more. That’s where you can find cafes and pastry shops. A successful combination of tenants is a planned process.
So a good retail leasing executive knows how to make clusters work in a retail property. Everything has to fit into the buyer’s requirements and the known changes in the demographics of the region.
A tenure mix can be shaped using the expiration of leases and known vacancy factors on the property. For the client who visits the property, he just wants to have a good time and get what he wants in a convenient way. The moment a commercial property stops doing that, rental and vacancy problems will begin. Plan your commercial property for today, but always look to the future and make wise decisions regarding tenants in the tenant mix.