Big retail stores have long been the draw to malls and shopping centers in California and across the country. Sears, JCPenney and Target are ones that many shoppers recognize and trust, and mall owners will admit that these and other department stores have been responsible for a large portion of the foot traffic they have seen. This is how they earned the name “anchor stores.”
However, malls are changing, and big retail stores are not the stable entities they used to be. Anchor stores across the country have closed, leaving malls with up to 70% of their square footage standing empty. If your business is looking for retail space as an anchor store, you may be interested in knowing about some of the trends analysts expect to see as mall owners look for ways to remain relevant and viable in a rapidly changing industry.
The benefits of being an anchor
With online shopping and recent health and safety concerns, the retail world has undeniably suffered, and some giants you may have thought were unsinkable have closed their brick-and-mortar stores. Nevertheless, malls are still operating, and the successful ones are finding new and exciting ways to use their anchor space. Office space, restaurants, go-cart tracks, comedy clubs and gyms are just a few of the innovative ways commercial property owners are drawing people to their malls.
Because anchor tenants are historically responsible for attracting large numbers of customers and potentially other businesses to a mall or shopping center, commercial property owners generally offer some perks to those businesses, such as the following:
- A significant portion of square footage
- Rent that may be as much as 10% lower than other tenants pay
- Signage that highlights the name of your business above other businesses
- A vote in the kinds of businesses that can rent space near yours
- The option to sublease part of your space, such as what department stores often do with hair salons, optometrists or portrait studios
These and other benefits of being an anchor store are not necessarily a given, and you may wish to enlist the services of a legal representative to assist you in negotiating favorable terms in your lease agreement. Additionally, you will want to understand any other documents or restrictions with which the landlord requires tenants to comply. Your attorney can also advise you on any other legal matters you may encounter concerning your commercial tenancy.
