Derelict and distressed properties can lead to the downward spiral in property value for residential neighborhoods. When it comes to the commercial side of real estate investing, empty retail space can easily detract from the location or the buildings’ allure to businesses seeking a commercial location.
Pop-up shops can make a great alternative when faced with a vacant commercial space. Don’t be discouraged by this temporary tenant. Your lease price is negotiable, and it is possible happy retail tenants could be back for repeat seasons. Pop-up stores not only fulfill your need for rents, but the tenant’s as well by establishing a location for a specific seasonal shopping experience.
Around the holiday seasons, in the 80s and 90s you would see seasonal retailers in the malls, now more and more are appearing in big box retail plazas and other smaller, yet impactful, shopping plazas.
What is a Pop-Up Shop?
Pop-up seasonal shops are just one-way commercial real estate owners can fill their empty stores at least for a few months. Alice Seale, CEO and founder of Seale Realty Advisors describes what this new real estate trend is, the “pop-up” store. “It [pop-up store] allows seasonal and online retailers, as well as manufacturers, that are considering a retail store expansion to test a retail market,” said Seale. “It also provides them the opportunity to get to know their customers with minimum cost outlay. Consumers love pop-up stores because they create an in-person experience with the product. Retail management and tenants tend to appreciate them because pop-ups draw frequent customers and provide a better retail merchandise mix.”
What are Seasonal Retailers Looking for in a Commercial Pop-Up Location?
According to Seale, seasonal retailers, be it Halloween or Christmas products, look for these four key elements.
1| Needs to be in a trade area that fits their primary demographics
2| Store fronts need to be visible to consumers
3| Great parking
How to Market & Attract Seasonal Businesses to Your Space
Seale suggests you use technology to best market your space. “If you are a landlord, your best marketing strategy is to send an email blast or utilize social media to inform the retail real estate community of the space availability,” she said. You can also use a real estate broker who will represent your best interests. If you do decide to hire a broker, perform your due diligence to ensure you are getting an ethical and reputable broker who has a track record of successful transactions.
Attracting seasonal retailers to your store takes a bit of assessment on your part. Researching the needs of retailers ahead of time will help you fill your empty stores. Seale reminds us store visibility as well as cost-effective adaptability of the space are crucial for these businesses. Citing that since they are temporary businesses, good exposure is what will draw in retail customers. She also points out how many of these retailers have their real estate teams searching at least six months prior to their business’ season.
Why Halloween Pop-Up Shops are Relevant
Halloween is ranked America’s third favorite holiday and revelers are forecasted to spend over $6B for the 2017 celebration. An article from chainstoreage.com, reports Halloween shoppers perform a majority of their shopping in person, 51 percent visiting a party supply store and 13 percent will patron seasonal pop-up shops. “A majority of Halloween shoppers still prefer to shop in-store versus online,” said Douglas Baldasare, CEO and founder of ChargeItSpot. “For Halloween, shoppers have a large variety of brick-and-mortar options available to them. And the two most popular product categories, candy and costumes, lend themselves to in-store shopping.”
Be proactive in marketing your empty store to attract temporary retailers that could fill your empty store fronts this season. Rents are always negotiable, and you might be able to make a little extra rent you were not expecting.
If you happened to miss out on this season, next year is right around the corner. Start planning now, so your empty stores don’t become zombie properties.
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Heather A. Elwing is the assistant editor for Think Realty. You can reach her at firstname.lastname@example.org.