Most people they would tell you that real estate is critical to a retailer’s success and that it is all about location, location, location. I could not agree more, but what is it that makes some retail locations extremely successful while others seem to have constant turnover?
We are going to focus on 5 key things when looking for commercial real estate for lease. These points are going to put emphasis on things that can make or break your retail business from a real estate perspective. There are certainly many other factors that can be extremely impactful from a legal and accounting perspective and we always advise you to get support from attorneys and accountants on those points. However, since we are a real estate company we are going to focus on the top 5 key factors to consider when evaluating commercial buildings for rent.
Over the years this information has become more readily and easily available. Any good brokerage will pull key demographic information on your behalf within a given radius. Most clients focus on 1, 3 or 5-mile radius reports. The key factors to look at are population, median household income, average household income, daytime population, households and consumer spending. If you are part of a corporate or franchise organization, be sure to request the demographics for the top three stores to come up with your target demographics.
What good is your location if people cannot see you or access your location? Know what kind of business you are in and what your clients want. Are you a destination business or do you benefit from traffic? Either way high traffic counts will always help with branding, visibility and impulse buying. Anything over 30,000 Vehicles Per Day (VPD) is worth paying a little more for the extra marketing and exposure. Be sure to get traffic counts from your broker and target centers on major thoroughfares.
Visibility & Signage
So, you have found a location with strong demographics and heavy car traffic, but what good is that if people cannot find you? Be sure to negotiate for the best sign package available and get signs that match the top sign packages within the center. Get pylon or shopping center signage as well. If there is any kind of highway exposure on the back or side of your space, request permission from your landlord to put additional lighted signage in those areas. Know that the city has most of the say and most landlords will accommodate your signage based on local jurisdiction.
Your ideal client is driving down the street right in front of your beautiful sign, so be sure they can gain easy access to the space. Always look for centers that have multiple access points, from multiple streets and have at least one full signal intersection. Right in and right out access is useful on a three quarter turn as well. Be sure that your clients do not have to do U-turns or make extra effort to get to your door.
Last, but not least be very careful about your parking requirements. Take note of your neighboring tenants. Are they all dinner restaurants or breakfast restaurants? If your clients cannot find parking they will go someplace else and probably not return. Be sure to ask the listing agent for the parking ratio which I would recommend be no less than five parking spaces per thousand square feet. If you are in the city take note of parking surface lot proximity, street parking and meter times. Always request designated parking for your clients. For example, a pizza restaurant may want a few designated spaces in front for customer pick up. Also, keep in mind parking space for your employees and make sure it is in a well-lit area.
Obviously, there is a multitude of other things to keep in mind and feel free to contact our brokerage with further questions. However, if you dial in on these 5 key points, you will find the best commercial real estate for lease for your business. Happy hunting!