Keeping Commercial Tenants Happy and Profitable
With the economy improving commercial real-estate and rental properties have also seen a rise in rent and demand. However, as mentioned in previous blogs, not all commercial rental properties have seen an increase in demand or increased rents. E-commerce giants like Amazon have put pressure on smaller retail businesses leading to less demand for retail space than in other commercial rental sectors such as industrial rental property. Therefore, it is important that commercial property landlords and property managers work to keep their current tenants happy and make sure they are fixing any issues that can hurt the business that is renting from them. While it is not a landlord’s responsibility to help tenant’s businesses stay profitable, it is important for landlords to make sure they are helping to facilitate the success of their tenants to ensure they can pay rent.
Make repairs and maintenance promptly: While landlords and property managers should always make repairs as quickly as possible, retail landlords need to make repairs quickly or complete maintenance during non-business hours so they do not negatively impact their tenant’s business
Consider the impact of raising rent: Raising rent at the end of a lease is a common occurrence in both retail and residential space. Often landlords aim to raise rent as high as possible without pushing the tenant to leave. However, while retail tenants may agree to higher rents because they can’t afford to move, raising rent to high can cause retail tenants to bleed money they need to invest in their business and keep it profitable. Raising rent to high could be a factor in why a tenant’s business closes costing the landlord money in the long term.
Screening out tenant competition and getting in complementary businesses: It is important that retail landlords do not accept new tenants into retail space that could potentially be seen by current tenants as competition even if the landlord does not believe they are. In addition, it's helpful if landlord markets towards prospective tenants whose businesses compliment current tenants’ businesses and could draw more traffic to the retail space which will be good for everyone.
Signs and Marketing: Landlords should also make sure their retail space has plenty of signs close to the street and nearby traffic to make it easier for customers to find the businesses and help drive foot traffic.
This post is provided by RISSOFT Residential and Commercial Property Management Software, specializing in innovative and cutting-edge property management software for all 50 states. Request a demo or contact us today to receive more information.
Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.