Most tenants in a shopping centre today are of the smaller business type. The tenants are usually centred around a ‘family business’. They thrive when the shopping centre is performing well; they struggle when the reverse is the case, given that it is the only location or one of just a few that they operate from.
It stands to reason that a successful shopping centre is built around well-chosen tenants that are trading at good levels. So, if you manage or lease a shopping centre today, the tenants that you communicate with are the foundation of property performance and occupancy.
- Can you improve your tenant relations this year?
- Are you watching the lease and occupancy changes at the property and are you prepared to negotiate leases early? There are things within that to think about.
Work the Tenants and the Mix
Keep in close contact with all the tenants in the tenant mix, and watch the interaction of anchor and specialty tenants in the property from a customer and client perspective. Then look for the tenant strengths and weaknesses and work with both. Tenant weaknesses can be resolved, and the strengths of a few tenants can be optimised for the greater benefit of the entire property.
Here is a tenant contact management plan that could be used in most retail properties over a 12 month period:
- Look at all the leases coming up for expiry in the next 24 months. Decide what tenants you would like to keep and those that are not quite as high on the priority list for ongoing occupancy.
- Package up some lease offerings for your ‘A Grade’ tenants so you can renew their leases early.
- Create meetings with all your major tenants on a monthly basis.
- Meet with all specialty tenants at least once every 90 days
- Create minutes of tenants conversations and meetings so you can react to or action any important issues early
- Look at the dynamics of the tenant mix and how the various merchandise groups are performing in comparison to each other.
- Create tenant management guidelines and lease negotiation documents within your retail property business plan. You can monitor your actions and decisions within that concept every 90 days as part of the property performance ‘check-up’.
So, these items form the basis of a tenant management plan and tenant retention plan in retail property. Forward planning like this will help you optimize the overall property performance and the selection of tenants into the future.