RETAIL LEASING RETAIL LEASING FOR COMMUNITY ORGANIZATIONS Institute for Comprehensive Community Development January 12, 2012 Larisa Ortiz Pu-Folkes

OVERVIEW CONTACTCASE STUDIES PROCESS RETAIL LEASING Overview Why does tenant mix matter?

OVERVIEW CONTACTCASE STUDIES PROCESS RETAIL LEASING Overview Positive correlation between Store mix Shopping density Access Results in Shopper preference Higher real estate values Retail sales growth

Case Study OVERVIEW CONTACTCASE STUDIES PROCESS RETAIL LEASING BACKGROUND:BASED ON LISC’S APPLIED RETAIL ATTRACTION TRAINING CLIENT: NYC DEPT. OF SMALL BUSINESS SERVICES PARTNER:JGSC GROUP DESCRIPTION:FOUR PILOT SITES Bedford-Stuyvesant Restoration Corporation, Brooklyn, NY Long Island City BID, Queens, NY Harlem Congregations for Community Improvement, NY, NY Women’s Housing and Economic Development Corporation, South Bronx, NY OUTCOME: 11 NEW BUSINESSES ATTRACTED TO DATE SIGNIFICANT INCREASED CAPACITY OVER 215 BUSINESSES IDENTIFIED AS PROSPECTS AWARDS:IDA DOWNTOWN ACHIEVEMENT AWARD NEIGHBORHOOD RETAIL LEASING PROGRAM

Overview RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE I LOOK, LISTEN, LEARN PHASE II FIGURE OUT WHAT YOU WANT AND NEED PHASE III IDENTIFY AND SECURE TENANTS PHASE IV CELEBRATE AND DOCUMENT OUTCOMES 1.ASSESS THE DISTRICT AND BUSINESS MIX 2.ASSESS CONSUMER DEMAND 3.IDENTIFY OPPORTUNITY SITES AND RETAIL CATEGORIES 4. COMMUNICATE YOUR VISION 5.DEVELOP AND DISTRIBUTE MARKETING MATERIAL 6.IDENTIFY PROSPECTS 7.MAKE THE CALL 8.BE READY TO HELP 9.CELEBRATE THE DEAL! 10.TRACK PROGRESS, AND THEN KEEP GOING

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE I LOOK, LISTEN, LEARN # Walk your district and observe the existing retail mix Assess the physical shopping environment Identify your traffic generators Talk to those in the know STEP 1: ASSESS THE DISTRICT AND BUSINESS MIX Relationships: Cultivate relationships to ensure that you have a realistic and informed understanding of the local market.

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE I LOOK, LISTEN, LEARN Estimate consumer demand STEP 2: ASSESS CONSUMER DEMAND Determine trade area Estimate leakage by category (leakage refers to retail sales lost by a community to businesses outside of trade area)

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE II FIGURE OUT WHAT YOU WANT AND NEED Develop an opportunity site inventory STEP 3: IDENTIFY SITES & RETAIL CATEGORIES Evaluate opportunity sites Identify Retail Categories to Target Consumer demand Community preference Size and configuration of opportunity sites Relationships: Reach out to property owners. Find out what is realistic and keep track of vacancies before they occur.

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE II FIGURE OUT WHAT YOU WANT AND NEED

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE II FIGURE OUT WHAT YOU WANT AND NEED Make the commercial real estate community aware of your targeted retail approach STEP 4: COMMUNICATE YOUR VISION Share your findings and vision with the stakeholders Become a vehicle for your owners and brokers to promote vacancies Relationships: In addition to property owners, brokers and retailers, get to know your local stakeholders, including government officials, and community board members.

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE III IDENTIFY AND SECURE TENANTS STEP 5: DEVELOP AND DISTRIBUTE MARKETING MATERIAL Map of the district that clearly identifies major activity generators Information about any incentives or resources for retail Testimonials from merchants Sales figures for your district

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE III IDENTIFY AND SECURE TENANTS

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE III IDENTIFY AND SECURE TENANTS STEP 6: IDENTIFY PROSPECTS Seek out prospects Network, shop, and advertise Get creative! Keep a Prospect Database

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE III IDENTIFY AND SECURE TENANTS STEP 7: MAKE THE CALL Conduct Prospect Outreach Invite prospects on a Choreographed Tour of your District Testimonials from existing businesses are an excellent marketing tool.

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PHASE III IDENTIFY AND SECURE TENANTS STEP 8: BE READY TO HELP Play the mediator to negotiations Be prepared with resources that will help tenants in their interactions with the landlord Don’t be discouraged, getting to “yes” can mean hearing “no” multiple times

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS CELEBRATE AND DOCUMENT OUTCOMES PHASE IV STEP 9: CELEBRATE THE DEAL! A grand opening is an exciting recognition Best way to build credibility and ultimately engage more property owners Issue press release, invite local leaders, cut that bright red ribbon

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS CELEBRATE AND DOCUMENT OUTCOMES PHASE IV

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS CELEBRATE AND DOCUMENT OUTCOMES PHASE IV STEP 10: TRACK PROGRESS, AND THEN KEEP GOING Have a system in place to measure success as well as failure Sharing your success will provide your organization with valuable recognition Rinse, wash, and repeat!

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS PARTICIPANT FEEDBACK: “Before I was concerned with approaching property owners. I didn’t have the resources or know how to follow through.” “We have established multiple new relationships, including property owners of 5-6 vacant spaces, and 4-5 brokers.” “We are targeting smarter.” “Brokers now know they have a partner in the organization has the capacity to understand the deal.” “The training allows us to have intelligent conversations and be a real partner.”

The Process RETAIL LEASING OVERVIEW CONTACTCASE STUDIES PROCESS It’s not over. In fact, it’s never over.