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We are in an option market…tenants have an increasing array of space options available to them, whether office, retail or medical. My advice to owners is simply; if you are in an option market, create and control your own options.

It is a competitive and nervous leasing market and therefore, it is wise for owners to abandon the “one-size-fits-all” approach to leasing.

Lease program development requires a careful examination of the prospective tenant’s business needs and qualifications. Whether the commercial real estate market is Prescott, Arizona, Tucson, Arizona or Phoenix, Arizona, presenting lease options to a prospective tenant can work well because options are non-threatening and they empower.

It is entirely possible that some leases can be optioned to the tenant where street rate is actually exceeded in years 4-5 of an initial term. In a market filled with vacancies and tenants seeking the best value in exchange for their commitment, it makes sense to offer optional leasing programs, which empower the tenant (let me give you a hint, they already have the power) to exercise the power of choice.

Vacancies are increasing and owners are competing for a limited number of truly qualified tenants. The option approach is another opportunity for economic performance. It will be some time before we can say to tenants, “The rate is the rate…” and have them sign off with little resistance.

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Donald Teel is a Senior Associate with Arizona Commercial, an Arizona commercial brokerage and property management firm. Need more information? Please call 1-877-777-9100 or, if you prefer, you may email Donald Teel

Retail shopping center owners, tenants and consumers are experiencing an unprecedented economic crunch. In short, all three are drifting in the same boat.

The International Council of Shopping Centers (ICSC), publishes a “Shopping Habits Report” in the first quarter following the end of a calendar year.

As a retail leasing specialist, I digested the entire 2009 report, subtitled, How the Recession has Impacted Consumer Shopping Habits, and discovered that indeed center owners need to be on top of the consumer game.

The “2009 Shopping Habits Report” contains invaluable information about the future consumer trends that will impact center owners, whether large or small in size.

You can read the report for yourself and draw your own conclusions. However, three things stuck out to me in the report:

• 58% of consumers believe their income will stay the same or become significantly less in 2010
• Most consumers have and will continue to throttle their discretionary spending through 2010
• Strip centers and “Lifestyle Centers” attract the highest frequency of repeat traffic

For those of you who are my clients, I want to briefly focus on the strip center/lifestyle traffic models, which run in the 70-75% repeat traffic level. In 2010 and 2011, my Company, is seizing on the concept of “life-styling” centers that have a higher than normal tenant mix by creating “Center Websites” that serve as a marketing destination point for Broker and tenant inquiries and present a center personality to the viewers.
Continue reading “Consumer Shopping Profile = New Marketing Approaches”

I read with a great deal of interest “Bright Ideas for Driving Traffic” in the February, 2010 issue of Shopping Centers Today magazine.

The relevance of the piece was the central focus of creating consumer recognition and value…what else is new in the shopping center marketing game?

What captured my attention in the article was the renewed interest in utilizing events and promotions as a traffic magnet for center impressions in the minds of consumers, tenant recognition and of course, foot-traffic.
Continue reading “Magnetism – Creating Center Value through more Consumer Exposure”