The most common way to find retail space is by hiring a real estate broker. Having said that, there are many classes of real estate and subsequently many types of real estate brokers. Make sure you hire a broker that specializes in commercial retail leasing. Often times, business owners by mistake hire the broker that sold their home or rented their apartment. These are residential brokers and will not understand the commercial real estate industry.
Complicating matters, commercial real estate does not have a centralized multiple listing service such as is the case with residential real estate. Therefore you need a broker that has a network of other commercial real estate brokers with whom will share with them what is available in the markets you are looking to start your business. A good commercial real estate brokerage will be dedicated to leasing and perhaps selling commercial property exclusively.
After you engage a commercial real estate broker, you will need to let them know your wish list and budget so they can start the search. There will be a lot of back and forth as you fine tune what you want with what is available. Furthermore because of the involvement of other brokers representing spaces you might be interested in, the process will be long and you need to be patient.
There will be times when you will pay your broker. In cases where the broker says the owner will pay the commission, beware that the broker is not your friend and will be out to negotiate the best deal for themselves.
Today,the internet is usually the first place people go for their information. It is a great place to see what is available in a market. As mentioned above, however, there is not a simple place or source where a business owner can see all the retail spaces available for lease in one place. You will be searching through multiple broker specific websites looking at possibly stale listings. Do not assume the listing is accurate, make certain to call the listing broker so you are able to make decisions based on current information. You might also try some broker sponsored listing sites such as Loopnet or Propertyshark. In the end, the internet will lead you back to a broker. The same warning holds true that the broker’s interest lies with who pays him.
The old fashion way is to take a walk around your target area. Even if you are using a broker or the internet to help with your search, it is always a good idea to walk around your anticipated market. You will learn a lot from seeing if the area is really appropriate for your business, you will access the competition, and obviously you will find vacant storefronts with for lease window signs and corresponding contact details.
The downside is that driving or walking your market is time consuming and you will again be dealing with multiple brokers. Again, make sure to call the listing. Do not assume it is available.
Storekeepers and local business owners are always interested in attracting new businesses that are complimentary to their existing businesses. This will bring additional commercial traffic to the neighborhood. A good strategy is to stop by difference storefronts and ask business owners how they think your business might perform in the neighborhood and perhaps they might know about spaces coming available. They might also know and help make introductions to area landlords or specialist area brokers.
Most tenants prefer to deal directly with landlords. There are several advantages to dealing direct. You will likely save time because communication is direct between principles. You will save money because you and the owner will not need to pay commissions thus resulting in perhaps a better deal for you.
Finding owners to deal directly is not easy because many large or well positioned spaces are represented by brokers. But if you are able to find the owner, owners are usually more than happy to deal with you directly because there is usually a carve out in their broker agreement that allows them to save commission if they find their own tenant.
Some ways of finding owners have been mentioned above, including walking around you target area and noting for lease by owner window signs, speaking with other neighborhood merchants, searching online. An online tool gaining popularity among tenants looking for vacant space and brokers representing tenants is UpPeg.com. UpPeg.com is a new marketplace where owners have uploaded their vacant retail space details and contact information so anyone that is interested can contact the owner directly.
Leasing retail space is not easy and is very time consuming because the commercial real estate industry is highly fragmented. Information is not readily available and transparent. Practices are still very archaic with the process conducted mostly face to face and through intermediaries. We havelisted the ways a prospective business owner goes about finding a retail space. Using all or a combination of the above strategies will net you your dream store because owners are obviously incentivized to lease out their vacant stores, finding them is the challenge.