We’ve met with retailers from all sectors at RECon ICSC this year and it is apparent that the partnership between retailer and landlord is increasingly important. Retailers are looking for contributions from landlords to support both the opening of new stores and ongoing refurbishments of existing stores in malls.
It seems that the trend of annual rent increases and annual reviews are less common, with large scale retailers now seeking a minimum of 2.0% reduction per year in rents. Capital contributions to new store openings is also an area of partnership, with landlords providing contributions to retailers from anywhere from $70 to $100 per square foot. This can represent 35 to 40 per-cent of the total cost to the retailer per square foot for new stores, so it is a significant contribution and assistance.
Landlords and retailers are now consuming more and more data and location analytics to make sure that these investments are made in suitable locations, corresponding to the increase in customer demand.
Springboard's location-based analytics can help inform and substantiate these decisions.
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