GUIDE TO SHOPPING CENTRE LEASING
The ultimate guide to retail leasing is to increase customer interest, retail sales and return on investment for the shopping centre.
Tenants with proven track record in marketing and retail are in high demand. It is essential to examine the experience of each tenants in retail sector they operate in.
In a retail shopping mall, allowing a permitted use approach in leasing is a smart move. Exclusivity should be avoided with your tenants.
A few factors to keep in mind are –
(a). A Clear Vision – One must have a clear vision of who the mall is going to cater to today as well as coming future and accordingly how the mall should be positioned and what kind of brands should be approached.
(b). The Science behind – A very good understanding of the zoning, category mix and proportion of each category in the mall depending on the size of the mall and other parameters, brand mix, etc. is required.
Understanding of the consumer behaviour and circulation patterns are also required.
(c). Critical Components of a lease- Important terms of the lease such as rentals, revenue share, CAM, HVAC, Marketing Chargers, Lock-In Tenure, Stamp Duty, Termination Clause, Escalation, Security Deposits, capes agreed are important to be considered in a long term lease.
(d). The Lease Model – There should be a clear understanding of under what model the lease is being done (COCO, FOCO, FOFO etc.) and the implication of each of the models on the mall.
(e). The Right Motivation – While money being a big motivator, but necessary checks should be made by someone who takes ownership of how leasing is being done in the mall.
Written By
Property Channel Expert
Anurodh Jalan
Jalan Property Consultants
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