While retail leases typically give you years of assured rental income, they can also pose the risk of longer vacancy rates depending on the market when those leases end. If that happens, some lateral thinking could make the difference between your space sitting empty, and earning you a return. Here are some creative methods to filling your commercial properties for lease until a suitable long-term tenant can be found.
Consider short term leases
If the market isn’t working in your favour it doesn’t mean there aren’t willing tenants in the shorter term. You could become a patron of the arts, so to speak, by renting your retail space out short term to pop up shops, seasonal stores and startups. The Empty Spaces Project has fostered creative spaces for artists and creators across Australia with great success, while Popupshopup connects landlords to businesses looking to test out the market in Perth. You never know: it could just lead to a long term commercial property lease.
Think about non-traditional tenants
While it’s obvious to search for long-term retail tenants for your retail space, there may be a hidden and untapped market to take advantage of. There may be churches, schools, training organisations and other non-traditional tenants who would find your space to be just what they need. These groups can be particularly interested in taking up an offer to lease commercial property for open floor, multi-use spaces with plenty of parking.
Offer smaller units of space
If offering your space isn’t working for you, you might think about subdividing it into smaller spaces for startup businesses or co-shared retail spaces. You may well find that there is more of a market for smaller businesses in outer suburbs or regional centres as opposed to a national franchise. Obviously, any changes you intend will be dependent on the zoning of the area and any council limitations.
Opportunities can come up in the most unexpected of places. You may be surprised by the situations that could arise from simply mentioning your commercial property for lease to business contacts and social networks in conversation. There could be someone, or someone they know, who is looking for exactly the type of space you have to offer.
Burgess Rawson’s teams across Australia have a thorough grasp of the commercial lease market in your area. Our friendly and experienced leasing agents are available to discuss what the right next step is for your commercial property investment, so contact us today.