Practical Tenant Mix Strategies
Previously we talked about the benefits of developing a tenant retention program. But one of the most important areas, an area often not understood, is developing a tenant mix strategy for your center. Getting and keeping quality tenants is more of a struggle than ever before and one aspect you need to consider is how your tenants relate to one another. Having a planned tenant mix strategy along with a tenant retention program in place will keep tenants happy, profitable and remaining in the center.
In evaluating your tenant mix for your center, here are a few questions to ask yourself.
- Will the new tenant compete with any of your existing tenants? In most retail centers, it is not a good idea to lease space to a tenant that directly compete with existing tenants. There are businesses that will benefit by locating close to their competitors. These tenants are usually companies that sell big ticket items that people want to shop and compare.
- What’s is the target market of your prospective tenant? Does your center attract a specific demographic group and will they shop at the new tenant’s business. It’s equally important to consider the type of customer that will be coming into your retail center from your new tenant. Your tenant mix could be dramatically different if your tenants cater to a high end shopper or bargain hunters.
- Can the tenant attract its own customers or do they require traffic from other tenants? Some smaller retailers will not attract enough customers on their own and will only survive in a location, center that already has a strong customer traffic.
- What will be the new tenant’s peak time for traffic into the center? Some businesses attract customers at different times during the day. Some get more traffic during the midday verses the morning or evening. If parking is limited in your retail center, it’s real good idea to have a tenant mix that has customers coming and going throughout the day. This way the parking lot is never too crowded at any given time.
- Will the type of new tenant encourage customers to stay in the center longer and patronizes other businesses or will they be in and out quickly? It’s important to understand if your retail center is just a quick convenience stop or geared toward creating a shopping experience. Tenants will sometimes pay a premium where shoppers stay and shop longer.
Developing a sound tenant mix strategy that helps you create the right mix of tenants might seem like an overwhelming process. But if you break it down in some simple questions that you ask yourself, its ends up becoming pretty easy to tackle. Don’t get me wrong, it takes time to develop a good tenant mix plan. Today it is even more important to have a strategy as retailers experience pressures from sales online and competitors in surrounding retail centers.
If you have any questions, just pick-up the phone (520) 465-5291, send a quick email or text.