A Fresh Look at Neighborhood Retail Centers for Landlords and Tenants
As retail continues to evolve in the new cyber world era, landlords are utilizing fresh approaches to create win-win centers for tenants. At ICSC RECon in Vegas I had the opportunity to talk to Mac Chandler, Managing Director for Regency Centers, a firm taking a new approach to the neighborhood center.
“We focus on connecting tenants with the location. We hire local architects and artists and work closely with tenants to deepen their connections to the community.”
Regency’s Fresh Look™ program takes a hyper-local approach to style and product mix and utilizes active social media engagement. They actively promote the centers and help tenants tailor their stores to the local customer base.
Known for their grocery-anchored centers, Regency is strong in coastal and infill markets, with 19 offices across the country. Despite low levels of new construction, they are successfully reinventing older centers, in some cases even transforming them with non-retail components.
“We just brought on an SVP of Mixed Use. Multifamily developers have to pay a lot for land, so the demand for retail in mixed use is growing.”
Rents are increasing rapidly in many of the popular retail corridors. Tenants are faced with rising rents when it comes time for renewal, but apparently they’re doing enough business to afford it.
“Our renewal average is very high. Our tenants grow with us. Some tenants say the mall is tough for them, and they much prefer a neighborhood center.”
Some might consider retail the trailing sector, but as households expand, so does retail performance. Economically, it looks like the sector is in good shape, and getting better.
Chandler’s tip for tenants: Lease in a center with a really engaged landlord. You want a landlord who will really partner with you for success.