6A — February 22 - March 14, 2019 — M id A tlantic
Real Estate Journal
M id A tlantic R eal E state J ournal By Brandon Anapol, Metro Commercial How retailers can overcome restrictive cove- nants in shopping centers: Part 2
n last month’s shop- ping center issue, I de- tailed one of the biggest
ample, ● If you’re a family enter- tainment tenant, show how moms like to shop for grocer- ies, clothes, and home decor before, during, or after they take the kids to the birthday party held at your venue. ● If you’re a fitness tenant seeking to lease at a grocery- anchored center, show how fitness enthusiasts like to pick up groceries or dinner after their workout. Fitness centers, urgent care facilities, family entertain- ment centers, and food halls are all in the active growth category. If you’re one of these or in another high-growth sector, provide data that dem- onstrates the potential for the shopping center and existing tenants by having you join the team. Be sure to provide data, trends, and reports from reliable sources. Arm the landlord with the information required to sell existing tenants At Metro Commercial, we recently encountered a situ- ation in which a national tenant was resisting signing
waivers to allow one of our cli- ents, a fitness center, to lease a space that had been vacant for several months. The ex- isting tenant had concerns regarding noise pollution and the potential for vibration to affect the use and enjoyment of their space. While the land- lord was frustrated, he was unsure how to proceed. He could see their point of view and so could we. These were legitimate issues for their brand and customer experi- ence. We knew, however, that we could provide information that could clarify and relieve their concerns. In a situation like this, the following package of informa- tion gave the landlord what he needed to inform the ten- ant, alleviate their concerns, and help them see the op- portunity. ● Develop a fact deck – The existing tenant’s primary concern was the po- tential noise level. To address the issue, we created a fact deck that included: ■ Results from noise level tests conducted at our client’s
existing locations. ■ A floor and site plan that indicated our client was pro- gramming the space with the quietest elements of the facil- ity along the demising wall. While the noise level tests proved that excessive sound levels would not be an issue, the floorplan and site plan provided an extra element of reassurance. ■ A customer profile that showed our client would be bringing in a more affluent customer base than was cur- rently coming to their center, enhancing their potential for incremental visitor traffic and spend-per-customer. ■ A traffic count indicat- ing that our client’s visitor traffic was higher than that of the former big-box tenant but would still allow for the existing parking allocation and distribution. In addition, we argued our client’s pres- ence would be beneficial in enhancing the perception of the center, which currently had a lot that was partially empty. ● Compile a press kit
– We provided a press kit that included the following: ■ A press release to be dis- tributed once the lease was signed, making sure it men- tioned the key tenants exist- ing at the shopping center. ■ Clippings of published stories featuring our client, its founders, commitment to the community, and mission. The landlord was surprised by the information we pro- vided and the opportunity for growth our client would bring to the center’s existing tenants. Using the informa- tion and data we provided, the landlord was able to suc- cessfully obtain waivers for our tenant to lease the space. In the midst of retail’s changes and challenges, there is also opportunity. Opportunities from which all parties--non-traditional businesses, landlords, and existing tenants--can benefit. The key is to show what’s in it for them. Brandon Anapol is se- nior vice president of bro- kerage services, Metro Commercial.
cha l l enges e m e r g i n g a n d n o n - traditional r e t a i l e r s face in to- day’s retail l a n d s c a p e - restrictive covenants in
shopping centers. Now that we identified the challenge, let’s take a more in-depth look at how retailers can create a solution. Inform the landlord on shifting trends that support your case Consumers are changing the way they shop. As more consumers go online for their needs, their expectations for convenience have increased. This means more combined trips and a desire for faster and closer shopping oppor- tunities. How will the shopping cen- ter and existing tenants be able to benefit from having you as a co-tenant? For ex-
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