It may come as a surprise to the average investors that the past two years of bankruptcy filings by long-standing retailers, such as Sears, Kmart and Toys R Us, may actually prove to be a big win for the owners of the properties where those retailers once operated.
For the most part, these long-term anchor tenants were paying lower rent for the amount of retail space they occupied. Over the past several decades, they made little to no investments in capital improvements and were unable to continue to be a draw for foot traffic. Therefore, as these retailers close underperforming stores, property owners have an opportunity to reposition and restructure the space to attract newer retail concepts that are flexible and willing to pay higher rent and invest in capital improvements to draw customers. In many instances, it will make sense for property owners to break up vacancies into smaller parcels to maximize the efficiency of the space and the retailers’ ability to improve the customer experience.
With offices in Miami, Orlando, New York City and Geneva, the team at Orion works with investors, developers, property owners and brokers through all phases of real estate transactions, from strategic planning and analysis to financing, negotiation, property management and disposition. For more information, call (305) 278-8400 or email firstname.lastname@example.org.