Retail Leasing During Covid
By Sturges Property Group Brokers, Neal Bowman & Philip Hagee
For the last 45+ years, the Sturges Retail Team has partnered with retail property owners to bring new lease opportunities to their respective properties. In the current climate characterized by retail closures, essential vs. non-essential, and rent relief, our client-focused, team-based approach has proven to be successful in fulfilling new lease requirements.
The Retail Team:
The Sturges Retail Team prides itself on outstanding market knowledge and the ability to facilitate harmonious Landlord/Tenant relationships. Our skilled Retail Team delivers guidance and consultation to tenants, landlords, investors, and developers, providing a full range of services including advisory and transaction services, acquisition and disposition strategies, and asset and property management.
The Opportunity:
The owners of a local shopping center lost its anchor tenant, an independent fitness user, who occupied 12,800 SF—approximately 50% of the entire shopping center. This particular submarket was defined by a mix of local and national retailers and service providers surrounded by large suburban populations with excellent demographics. Vacancy rates in retail shopping centers in this area were very low, especially in units that were 2,000 square feet or less.
The likelihood of finding a large user to backfill the space in a timely manner was very low, so the Retail Team, in coordination with the Landlord, was tasked with marketing the property to smaller tenants who could pay higher per-square-foot lease rates within the submarket. Doing so increased the long-term value and leasability of the building.
The Retail Team created a marketing plan that consisted of targeted email campaigns, virtual video tours, social media posts, cold calling, and listings on major online commercial real estate marketplaces. The highly viewed shopping center email campaign received a total of over 2,600 views and over 27,000 online marketplace views.
The Outcome:
Through the pandemic, the Sturges Retail Team was successful in securing four new leases at an average of 1,600 SF with strong operators and an excellent mix of users at a much higher per-square-foot rate than the previous fitness user. Sturges was involved in all aspects including negotiation of lease rates, tenant improvement allowances, and delivery of the premises. This was done through virtual video tours, Zoom conference calls between all parties, and property tours with proper PPE and social distancing measures in place. Of the original footprint, 6,400 SF remains available for lease with Landlord incentives and flexible sizing available.
This Retail Team case study is just one of many clients Sturges has helped during the last few months. As one of the largest full-service commercial real estate companies in northern Indiana, Sturges Property Group is your partner for retail leasing.
