Shawn Saraga
SVP & Market Leader
Toronto
There is a lot of talk going around about where the best locations are going to be in urban markets with condo communities, power centers in the suburbs, traditional high streets, high performing enclosed malls, etc. The retail landscape in Canada, as always, is evolving. This is nothing new to experienced retailers and real estate representatives who are used to change being our only constant. The real question is, who will adapt their art of site selection to include the right science to make informed decisions?
We live in an era of so much technology and information that very little proprietary IP still exists. While you can find plenty of information by performing a Google search, the value of the information depends on what you do with it. Want to understand bench marking tools for site selection for taco trucks? Google it; it is out there. Want to learn the top criteria for the world’s largest burger chains when it comes to picking a location? Google it; it is out there. Need to get a better idea of the criteria of site selection for a high street fashion retailer? Google it and you will find it. What you do with this information and how you translate it to support your concept’s site search, along with your own data, is the bigger challenge.
A retail leasing professional’s primary job is to take data and turn it into useful information that can assist with making informed decisions. The resulting decisions become an art backed up by the science. The more science they have available the better. How they interpret that science along with their client can make the difference between success and failure.
In negotiations, hubris can be a deadly vice and most landlords are aware of this. I will give you an example I saw first-hand very early on in my career. A new-build plaza was the perfect location for a casual diner with good demographics, strong traffic counts, complimentary tenant mix, etc. The challenge was the positioning on the property. The casual diner wanted an up-front, free-standing pad with a patio, and the landlord wanted them set back in an end-cap so that they could put a bank on the pad instead. The realtor I was working under at the time and I argued that this location would limit visibility dramatically and affect the store’s sales. The visibility would be significantly poorer to the neighboring competitors. The landlord requested a face-to-face meeting with the client to sort the matter out.
In the meeting the landlord offered a $3 rent reduction and played up the client’s ego by how they shouldn’t be worried about the set-back given how much they believed in their concept. They really played up the pride the client had in a new design and the client went straight for it. Despite our best efforts to council against the decision to accept the relocation, the client did accept the relocation. The restaurant was open for a total of 3 years before closing its doors due to a lack of visibility and sales. The client’s response was and still remains, “What could I do? If I didn’t take it, I wouldn’t have opened.” What they failed to realize was that if they wouldn’t have taken it, they wouldn’t have closed either.
The SRS Canada team has some unique science and bench marking tools readily available to help our clients make the best decisions possible when it comes to retail leasing. We have a cumulative 60 years of experience that we can provide to help make our client’s retail investment dollars go further.
Written by Shawn Saraga, SVP and Market Leader, SRS Canada