Is your Tenant Critieria Outdated?

Now that development has slowed down in the retail sector, developers are looking at their portfolio and hopefully giving some of the operational centers some much needed attention. The newer developments of the portfolio have probably had their Tenant Criteria Manuals revised. It's most likely customized to show that center as a unique property and used as a marketing tool as much as a technical manual. Hopefully they turned out to be a really effective tools for the TC department to quickly get the correct information to tenants. But what about your other properties? I am always amazed when I redo a criteria manual that it hasn't been updated in decades! Some of them were typed on typewriters with an old Landlord's name whited out (remember that) or still popping up in the text. There are usually an unacceptable amount of redundancies and outdated information. For each mistake, it takes someone in your organization at some level to catch and correct. So why not get it right the first time. This is the face of the company to your clients, your tenants, those whom you are about to expect to perform.

I think some TC departments struggle with the uniform vs. customized approach. I don't think it's an either/or argument. In the uniform approach the manuals are mostly the same, same graphics, but customized for each center. There is an economy of scale factor to this that makes it really smart for most of the portfolio. My previous post talks about the benefit of customization. I think now is a good time to get those manuals revised and posted in digital format for the tenant to download. I think it's also good practice to correct the manual on a regular basis, adding information as needed.

The New Food Court

At Westfield, where I worked as a Tenant Coordinator for 8 years, we tried to transform the American food court into a dining experience. It didn't seem right that the level of store design had reached a sophistication that you completely lost when you turned into the food court. No matter how upscale the mall tenants, the food court formula was always the same; 4"x4" bathroom tile, backlit menu board hanging on the back wall, a mismatch of equipment on the line, backed up to a low wall, tube steel posts on the sneeze guard (that could hold the building up) and an exposed neon sign. This is not the case in the rest of the world. In Astrailia, Westfield's food courts were completely different from what we know here, at least in some of thier centers. Their food court tenants look more like very hip restaurants with the latest materials, subtle but powerful graphics, and the food merchandised as carefully as any jewerly store would. So how do they do it?



There are some tenants whose concepts slip right into this model. They are already using very sophisticated design, but their is ususally one per center, the rest need alot of help. At first, when we tried to get the tenants to revise thier concepts we were met with alot of resistance. Then Westfield realized they had to give the Tenant Coordination Department the support they needed. Alot of the design work is actually done by designers in the TC department. There is a very loose, but heavily design oriented criteria is developed. They first have to work with the tenant to make them understand the goal of the project. Of course, leasing and development have to get on board and be willing to sacrifce a deal if the tenant will not conform to the program.



Until it becomes the norm, this new food court concept is not going to work for every center. But it is for any cutting edge development. In this economy, where leasing are trying to hold onto whatever deals they can and tenants are not willing to give up their traditional brand identity, it would be very hard. It requires commitment from the top executives.



For tenants it is a upfront investment of time and money, but the payoff is clear. If you are viewed as cutting edge you will access a new breed of clientele who normally shop but don't eat, or pass the food court to get to the one of the restaurants nearby. You will be viewed as having a nice clean operation with fresh food.

The Value of a Good Tenant Criteria

I'm often asked what a Tenant Criteria Manual is and if a Retail Developer really needs to develop one for a specific project. The answer is yes, absolutely. They are a really valuable tool that is referenced in the lease and therefor becomes a legal agreement between the tenant and the landlord. It is the landlord's only opportunity to get all the overall requirements of the tenant in writing without taxing Lease Admin (they have enough particulars to add as it is). I look at the Tenant Criteria Manual as serving three purposes. 1. to inform the tenant of their Scope of Work. 2. to inform the tenant of all Existing Building Conditions 3. A VALUABLE MARKETING TOOL:

1. Tenant scope of work. This is obvious - You do this -We'll do that.

2. Building Conditions. The more information that is provided the tenant the better equip they will be at the onset of their construction documents, the less comments will be on the drawings, which means less revisions, and the faster the drawings will be approved, (now your getting the picture), the faster the tenant will open, the sooner you can collect rent! The power of this document often goes completely unnoticed, but trust me, you can shave weeks off a tenant's schedules by getting this step right.

3. Critieria Manual as Marketing Tool. As a developer you want to put your best foot forward when starting a project with the Retail Design Team of a any Tenant. You want them to classify your development as an "A" Mall at a glance. National tenants and franchises often have "A" and "B" concept (not always, but often) so if a tenant can get away with a cheaper design, you may not get the best design available. BUT, if you put a really cool Tenant Criteria Manual in front of that same design team they will have no doubt what they can get away with. And as a developer, if you just spent millions of dollars to renovate your mall you want to make sure you are getting the best designs possible. A good Tenant Design Reviewer with a lot of design experience will know the latest concepts and how to get best design out of their tenants (but that is for another post).

Welcome!

Well it's a great day to start a new project, mine being this blog. We have a new President and hopefully America's confidence will turn the tide of this economic decline. I am focusing on building a website and getting the word out about what I can offer developers and tenants. I will add posts about Retail Developement, Tenant and Landlord relations, and Tenant Coordination issues. I hope you like it and will Follow Me or Subscribe to the blog and join in to comment.
Thanks,
Tricia