Prepare Your Vacant Retail Space for Greatness

“Penny wise and pound foolish.”

I take this to mean “focusing on frugality distracts you from creating value and wealth.”

Unfortunately, I see this all too often… especially when it comes to leasing vacant space. Typically, the landlord's hope is that the tenant will be happy to improve the space and increase their property value.

I have news for you: They won’t.

Many tenants have incredible imaginations, but when your space has mold, dust, debris, old electrical services and broken HVAC, that imagination quickly vanishes. And the Tenant vanishes too. Eventually, landing your perfect tenant becomes incredibly difficult.

Prepare your Retail Space for Greatness

Don’t fret—there is some good news: A simple formula for cleaning up your space exists. A small amount of work on your part will instill confidence in you as a landlord, and will ensure that the property shows that much better than the competition.

The best part? It doesn’t even have to cost thousands.

Preparing the Infrastructure

Infrastructure is vital for any commercial tenant, and includes things such as electrical, plumbing, and HVAC.

The issue is that it’s tough to predict what a tenant will need when they lease the space, and it’s likely they will require an upgraded service or more HVAC capacity.

So… what’s a commercial landlord to do?

Typically, rather than leave the infrastructure as-is, I would recommend the following:

1) Remove any extra or redundant systems that are cluttering up the space such as: Old sinks or plumbing runs; Old outlets for the previous tenant’s trade fixtures; Redundant or specific use light fixtures that are now out of place.

2) Hire a licensed trade and investigate what capacities are available to your building, such as:

• If you currently have a 100amp service, is it possible to bring in a 200amp service? If so, at what cost?

• If you currently have a ½ inch water supply, what is the cost to bring in a ¾ inch line

• What is your current AC capacity and air exchange rate?

Knowing this information during a tour with a potential tenant will impress them and help them to feel at-ease with the quality of the unit, and it will remove one more objection a prospective tenant may have.

Polish the Look and Feel of Your Space

Take a look at the space. What makes it unique? Try to bring out those features. Vintage features, such as tin ceilings, terrazzo flooring, exposed brick and old woodwork can go a long way to selling the space… and if it’s a contemporary retail unit, there’s a lot that can be done to clean it up.

Ceilings

Tin ceilings were introduced to North America during the late Victorian era as an affordable alternative to the exquisite plaster-work used in European homes.

Its possible you have a beautiful tin ceiling under that drywall. Often, however, you will need to keep that ceiling drywall in place, or even add to it to ensure fire-code compliance. In the event you have a tin ceiling that is already exposed, leave it in place, and if down the line it needs to be covered for proper fire separation you can try to salvage the tin and reinstall it on top of the drywall. Or, there are replica products that look good as well, however, contact your local architect for more details.

If you have a newer retail space, change out any stained ceiling tiles and install new light lens covers. It isn’t recommend to replace all the tiles, as a new tenant may need the drop ceiling removed.

Floors

If you have beautiful old wooden floors… consider refinishing them. It is not costly and will transform your space. The life restored to original hardwood goes a long way in impressing potential tenants.

Newer space with concrete floors? Remove old carpeting and ceramic tiles. Chances are, a new tenant won’t be able to reuse them, and keeping them only adds to their buildout costs.

Walls

If there are existing rooms or “partition walls,” it can be a tough decision whether to remove them.

As a rule of thumb, if the existing layout is likely to fit your ideal tenant, keep the walls. However, only keep them if they are well constructed and high quality. In most other cases, it is best to remove almost all partition walls, except the bathrooms.

Once that is complete, mud and prime the perimeter walls, and paint the space a bright neutral colour.

Exterior

The outside of the space is the first thing a prospective tenant will see.

Do you have an older brick building? If so, consider hiring a local mason to replace any spalling bricks or crumbling mortar. Then, paint any woodwork that needs it. This includes cornices, dentils, window frames, lintels and doors.

Almost There...

Do your final cleanup of the space and wash the floors and windows, then hire a professional photographer to take photos of your space.

Yes, everyone nowadays is a ‘photographer’ thanks to their smartphone, but your money will multiply if you take this important step. Your space has mere seconds to impress a prospective tenant… put the wrong photo up, or even worse, a cell phone photo, and they move onto the next listing. Professional photography is worth the money.

Additionally, hire a professional draftsperson to measure and draw up the floorplans of the existing space. Don’t have someone? Simple, just Google ‘local building measurement services,’ or ask your Realtor. This important step will really elevate your space and yourself as a professional landlord. And remember; the size of the space drives your rental rate.

One final word—do not paper over the windows of the space. Showcase it, you have nothing to hide.

It’s Show time!

Why go through all the hassle? Because it shows tenants that you are a professional landlord and take care of your property. Doing this work ahead of time makes it much easier for the tenant to envision the space and it removes an objective which otherwise would have to be addressed. Also, since this work is already completed, it reduces the buildout time and cost.

Your tenant will be open for business and paying rent sooner.

Always remember: your tenant is entering into a long-term relationship with you. If you are not willing to invest in your own building, why should they?

I hope you found this post useful. If you want to chat more about commercial real estate or leasing, please feel free to reach out.

Evan J. Apostol, Sales Representative 

Blair Blanchard Stapleton Limited

Evan is a commercial real estate sales representative specializing in retail, office, and industrial sales and leasing within Niagara, Hamilton and Halton, Ontario.