Leasing Tip of the Day: Understanding Your Neighborhood’s Demographics

As a well-heeled retail leasing expert, I cannot stress enough the significance of giving extra consideration to the demographic makeup of the neighborhood when filling vacancies in your retail property. It’s not just a minor detail; it’s the cornerstone of your leasing strategy.

In my many years of experience, I’ve learned that no matter how attractive your property may be or how well you execute other aspects of leasing, if you ignore the demographics, you’re setting yourself up for failure. Let’s break it down:

1. Matching Tenants to Demographics: Start by studying the area’s demographics around your property. Are they primarily young professionals, families, or retirees? Tailor your tenant selection accordingly. For example, don’t target high-end cosmetic procedures in a low-income neighborhood or a budget check-cashing business in an affluent area.
2. Observing Success Stories: Look around your neighborhood and see which businesses are thriving in spaces similar to your vacancies. Are there restaurants, medical facilities, or salons with lines out the door? These could be potential tenants ready to expand.
3. Learn from the Competition: Remember the insights you gained during your “coffees with the competition” when creating your market study. Take note of what types of businesses are flourishing in their centers.
4. Exclusives and Restrictions: Keep a close eye on your lease agreements. Exclusives and restrictions can guide your tenant selection. Exclusives, which specify the types of businesses that can’t lease nearby, differ from prohibitions. Ensure you understand and follow these terms.

Lastly, it’s essential to stay updated with the latest data sources. Traditional demographics based on old census data are becoming obsolete. In the coming years, I believe the CRE industry will shift towards using geo-fencing and real-time cell phone data for more accurate insights.

Understanding your neighborhood’s demographics is not just a step in the leasing process; it’s the foundation for your success. Before approaching potential tenants, take the time to research your area’s demographic makeup – it could be the key to unlocking your property’s full potential.

Happy Leasing!