How to make the perfect tenant mix in 2021
2020 proved that a stable industry could quickly be turned upside down and begin to struggle with the flip of a switch (or stay-at-home order). Retail definitely struggled in the past year, but that is why, to make 2021 better for everyone involved, an appropriate (and profitable) retail tenant mix is necessary.
Tenant mixing allows for maximum sales traffic through the mixing of various tenants under one building or center and has been noted as one of the biggest reasons for the success of a shopping center according to an analysis on Tenant mix variety. An early form of tenant mixing began in the early growth of American Malls. Malls were a newfound place for social gathering and interaction, which generated profitable growth in the retail world. Currently, tenant mixing drives the need for authentic shopping and retail experience it also prompts the redevelopment of properties. Having an appropriate and balanced tenant mix is what determines the retail value of the property.
So, what makes the right tenant mix? A good tenant mix has a mix of retail stores that complement one another. Together, they form the shopping center's image. Finding that certain balance that keeps up with the particular quantitative and qualitative demands is key. A diversity in tenants is significant because what is more popular than ever for shoppers is convenience, having everything needed all in one place. Having an intense anchor retail center is also crucial. In the past, malls that hold Macy's or a JCPenney are noted to generate revenue better. Today, these big box stores aren't cutting it.
The pandemic has served as a wake-up call, and it is important to acknowledge that when designing a tenant mix. The pandemic has caused people only to feel safe enough to leave their homes when it is necessary. The smartest choice would be to invest and incorporate those places; doctors and dentist office, fast and convenient food, etc.
The pandemic may have made changes in the way one must approach retail tenant mixing, but it has not made it impossible.