Vacancy Rates in Retail Property Today

woman walking in shopping centre supermarket
Get your vacancy rates down. Monitor all leases and tenant changes. Find new tenants fast.

The most important step in keeping your shopping centre or mall occupied is realising the total economic impact of having to re-lease the space.

Consider the effect should one of your tenants go out of business:

  • Can you find a replacement tenant?
  • If so, how long will it take?
  • Will you be able to achieve anywhere close to similar rental from a new tenant?
  • What will legal fees cost you, if you choose to go after the old tenant for leasehold performance?
  • What will leasing commissions for a new tenant cost you?
  • What will tenant improvements cost, plus an inevitable period of free rent?

Unless you have awfully deep pockets, you can’t afford substantial vacancy in your centre – so you can’t afford to ignore your tenants’ concerns.

  • Be willing to listen to their concerns. Tenant feedback can be most helpful.
  • Work on a new promotional campaign – with tenant input.
  • Does the centre need repairs? Paint or landscaping, for example? Consider the costs of repairs versus the cost of re-leasing should several tenants decide to leave.
  • Always search for ways to improve your centre. Strive to achieve the most dynamic tenant mix. If a tenant vacates, work hard to improve that space with a promotional tenant who will help the rest of the centre.
  • Finally, know your competition. If your centre is not competitive with those in the surrounding area and your centre management responds with complacency, the centre is doomed to failure.