3 Key Factors to Consider When Leasing Retail Space
Evaluate the Parking, Frontage, and Zoning
Commercial retail space can vary by development, but there are some fundamental elements of a property that prospective tenants should take into consideration when shopping around for a new space.
There are a number of features you can change about commercial space, including flooring, lighting and wall color. One feature that can't really be altered or improved upon, typically, is the parking lot.
I often have tenants ask me about designated parking, for example. While some landlords will offer it, there is often very little they can do to police it. If you think a parking lot is not going to serve your retail customers' needs, it's probably a good idea to keep looking.
Something else to consider is the street access to the site. It's worth evaluating what level of hassle customers may encounter trying to drive on and off the site.
In addition to having more specific parking requirements than many other commercial tenancies, retail tenants crave frontage.
Most retail spaces will be built shallower than a warehouse bay in depth, where narrower real-estate frontage comes at a premium to attract the attention of foot traffic.
In an ideal world, retail space has the maximum permitted amount of windows at the front. It can sometimes be an option to add windows, but this is a costly change to make. If possible, I suggest narrowing down the search to properties that will not require such costly changes.
Another thing to evaluate is the opportunity for signage as it relates to frontage and street exposure. A narrow space may not offer much in the way of available street-facing and front signage opportunity. Be mindful that it's enough to advertise your business appropriately.
Tenants in any municipality must make sure their intended use is allowable in the area they've chosen to set up shop. If, for example, a good portion of the street in a given municipality is B zoning, which allows most retail uses, one should not assume the small houses on adjacent side streets are also. They may be zoned differently and have restricted retail use.
Spot rezoning for retail use does not happen often and is especially onerous to achieve. It's probably not a good idea to bank on getting a rezone if you're considering a site that has retail restrictions.
The best way to determine allowable uses is to contact the city directly with the address that's of interest to you. Plus, a good agent will know the areas suited for retail use.
About the Author: Kelly Macsymic
Having joined ICR Commercial Real Estate General Partnership in 2008 as a sales associate, Kelly Macsymic is also business manager for Stuart Commercial Inc. With a Bachelor of Education degree, as well as a Diploma in Print Journalism, she is a stickler for detail. She wants her clients, whether new or experienced, to fully understand their real estate transactions, and she enjoys seeing her clients' businesses develop successfully.