What to look out for when committing to new retail space off-the-plans
New mixed-use developments and dedicated retail new-builds are providing fresh options for business owners around the country and we have a few hot tips for those looking to secure space off-the-plans.
Naturally you will want to locate your retail store in an area with maximum bang for your buck and the demographics of an area will largely dictate this.
Invariably, new developments will attract a certain consumer base and you need to determine whether this is going to suit your business model and retail offering.
Getting good information from the developer and having clear communication lines will enable you to see if a new development is going to be a good fit for your business.
Here’s some other pointers:
• Ask to see very detailed spatial and visual plans in order to make informed decisions • Do some background research on the developer and check out their other developments to benchmark quality and success • Ask the developer/agent for demographic data/research and have them clearly define the overall vision for the development • Assess how the new development fits into the market – high end, middle of the road, apartments above, office tenants nearby, big box retail close by? • What are the car parking ratios • Clarify what early interest there has been and the tenant mix expected as you don’t want to be operating in isolation. Neighbouring space earmarked for retail yet ultimately occupied by service/office businesses might not work for your retail business • Understand the base specifications well. A hospitality base build will be quite different to a bare shell retail space • While the location may appeal, is the building right for your business. For example, power phasing, extraction fans and gas supply will be important for hospo’ operators and these things are difficult to address once construction is well-advanced • Get in early so that you can have some useful input into layout, specifications and finishes • Seek to protect your business interests by finding out what non-compete or tenant mix clauses are included in the lease e.g. only one café or hairdresser • Is the price point or lease/rental figure viable for your business and what potential growth could a new premises offer you • Be open-minded and flexible – a new development will always attract customer interest. Can you leverage off the location and buzz to make a go of it. • Work with an experienced retail agent who has a good grasp on market dynamics, knows the competition, and is up-to-date with retail space availability and development flows.
A good retail agent will know about up-and-coming developments and tenant interest in these, and have good locational insights. They will also know where the development sits in terms of market rents and any incentives available to tenants.
Deals are matched on landlord capability/capacity and tenant requirements so finding the perfect new space for your retail business will be easier if you seek out the services of an experienced retail agent.
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