Second-generation retail spaces offer landlords and tenants unique opportunities and challenges. In this post, we’ll explore why leasing second-generation retail space is advantageous and provide essential tips for success.
Defining Second Generation Retail Space
Second-generation retail space refers to commercial properties with existing layouts and infrastructure from previous tenants. Despite variations in condition and size, these spaces offer potential for revitalization and reimagining. Common use types for second gen space are restaurants, hair salons, nail salons, medical office, etc.
Advantages
- Established Infrastructure: Ready-to-use infrastructure like HVAC systems and electrical wiring save time and money on renovations.
- Prime Locations: Located in high-traffic areas, these spaces offer immediate visibility and accessibility.
- Cost Savings: Competitive lease rates compared to new constructions attract budget-conscious businesses.
- Faster Time to Market: Existing structures enable quicker move-ins, reducing downtime.
Challenges and Considerations
- Repositioning: Adaptations may be needed to align with the new tenant’s brand and customer experience goals.
- Branding and Image: Updates may be necessary to create a cohesive environment.
- Lease Negotiations: Flexibility in lease terms is crucial to accommodate tenant requirements.
Tips for Success
- Flexibility in Design: Work collaboratively with tenants to meet their vision for the space.
- Clear Communication: Manage tenant expectations by transparently communicating about the space’s condition and potential renovations.
- Market Positioning: Highlight the space’s advantages to attract prospective tenants.
- Collaboration with Tenants: Foster a cooperative relationship to ensure a smooth transition.
- Marketing and Promotion: Showcase the potential of the space through targeted marketing efforts.
Leasing second-generation retail space presents an opportunity to breathe new life into existing properties while capitalizing on established infrastructure and prime locations. By understanding the advantages and challenges and following essential tips for success, stakeholders can create thriving retail environments.
Browse our current opportunities for second generation space here!