Term
| Free-standing and single store- |
|
Definition
| single structures designed for one or a few tenants, often located on a "pad" or outparcel in the parking area of a shopping center; generally less than 20,000 square feet; often the result of "infilling" to meet unmet specific retail demand near major shopping centers or major corridors. |
|
|
Term
|
Definition
| free-standing or connected structures arranged in a line along a commercial street; stores generally owned and operated separately, with no central management or leasing program. |
|
|
Term
|
Definition
| multi-tenant structures designed to meet the particular needs of a trade area; amenities and parking are appropriate to an anticipated level of sales volume; usually managed as a single property. |
|
|
Term
|
Definition
Total gross leasable area: 1,000,000 square feet
Site area: 80-100 acres
Trade area: 300,000 people in a 12-mile radius or 30-minute drive-time radius
Anchor tenant size and number:: three or more major department stores, each having at least 100,000 square feet
Tenant mix: wide variety of merchandise and services; large tenants spread out, smaller tenants in between |
|
|
Term
|
Definition
Total gross leasable area: 300,000 - 1,000,000 square feet
Site area: 30-50 acre range
Trade area: 150,000 people in an 8-mile radius or 25-30 minute drive-time radius
Anchor tenant size and number: one or two full-line department stores of 100,000 square feet or more
Tenant mix: variety of merchandise and services in smaller stores |
|
|
Term
|
Definition
Total gross leasable area: 250,000 - 450,000 square feet
Anchor tenant size and number: no full-line department store, but several strong specialty anchor stores
Tenant mix: same basic services as a community center but with a greater variety of goods and services |
|
|
Term
|
Definition
Total gross leasable area: 100,000 - 300,000 square feet
Site area: 10-30 acre range
Trade area: 40,000-150,000 people in a 3-5 mile radius or 10-20 minute drive-time radius
Parking index: 4-5 spaces per 1,000 square feet of gross leasable area
Anchor tenant size and number: usually built around a supermarket, junior department store, variety store, or discount store
Tenant mix: convenience goods and personal services, soft and hard goods |
|
|
Term
|
Definition
Total gross leasable area: 30,000-100,000 square feet
Site area: 3 acre range
Trade area: 2,500-40,000 people in a 1-3 mile radius or 5-10 minute drive-time radius
Parking index: 4 spaces per 1,000 square feet of gross leasable area
Anchor tenant size and number: usually built around a supermarket or drug store
Tenant mix: convenience goods and personal services for the immediate neighborhood |
|
|
Term
|
Definition
Gross leasable area of 10,000-20,000 square feet
Site: arranged in a line along a street or parking area
Anchor tenant size and number: often has an anchor tenant at either end |
|
|
Term
| (7) Specialty or theme center |
|
Definition
No traditional anchor tenant
May have a single architectural scheme
May be built around a type of business, such as home improvements, apparel, discount, or off-price merchandising
Often local in impact |
|
|
Term
|
Definition
| arbitrarily defined as having outlets in four or more metropolitan areas in at least three states. |
|
|
Term
|
Definition
| three or more outlets in one to three metro areas in fewer than three states. |
|
|
Term
|
Definition
| operate in a single metropolitan area and have no more than two outlets. |
|
|
Term
|
Definition
It is known that consumers go to certain stores for certain things and will travel known distances to get particular goods or services. For instance, consumers will travel further and spend more time getting to specialty stores, since specialty goods are harder to find and the customer doesn't often need them. On the other hand, consumers will not drive any further than necessary for often-purchased items such as groceries and convenience items.
Tenant mix in retail brokerage is the particular combination of user types within a center. The classic concept of tenant mix in a center is that some kinds of stores-- the anchors or attractors-- draw consumers into the center past the less compelling stores-- the satellites-- and that all stores share in the foot traffic. The same concept may be applied to single stores in a commercial area or in a commercial strip. |
|
|
Term
|
Definition
| In general, a retail trade area is the geographical area that contains the sources of demand a retailer needs to support an outlet at a location. |
|
|
Term
| The population and expenditure approach |
|
Definition
| Given a number for required sales dollars per square foot and per capita information about dollars typically spent on the retailer’s type of good, one uses population and income data to delineate an area around a potential location which contains enough people and income to generate the required sales dollars. |
|
|
Term
|
Definition
| Given the same required sales and per capita spending information, one applies a typical drive-time factor to delineate a drive-time radius for the location. One can then study the income and population data to determine whether there is sufficient demand within that radius to support the store. |
|
|
Term
| The traffic count approach |
|
Definition
| Given the same required sales number plus information about average dollar amount per transaction, the percentage of customers in the store who make a purchase, and the percentage of passing traffic that will enter the store, one can work backwards from data on passing traffic to estimate whether there is sufficient demand at the location to support the store. |
|
|
Term
| Gross Leasable Area (GLA) is distinguished from two other measurement methods: |
|
Definition
Exterior gross area-- the total of all the enclosed floor areas of all floors, excluding voids, interstitial space, unexcavated space and crawl space.
Construction gross area--the area defined as exterior gross area, plus other areas that have a structural floor or are typically enclosed but within the building perimeter.
Gross leasable area-- the total enclosed floor area designed for the exclusive use of an occupant, including basements, mezzanines, and upper floors. |
|
|
Term
| Common Area Maintenance (CAM) |
|
Definition
| Methods of calculating tenant expenses for common area maintenance vary. A typical retail lease will require a tenant to make monthly payments based on the ratio of the tenant’s floor area to the sum of all leasable ground floor area in the center. |
|
|
Term
|
Definition
| Retail leases typically include a base rent amount plus an amount based on a percentage of gross sales generated at the leased site. The percentage charged may be a straight percentage with no minimum, a minimum plus a percentage, the greater of a minimum or a percentage, or a minimum plus percentage with a cap on the total. The methods of calculating gross sales, the percentage used, and the frequency of calculating and paying are all significant factors for the tenant. |
|
|
Term
| Explain the concept of a good tenant mix in a retail center. |
|
Definition
| A good mix combines stores that draw from a larger area or drive-time radius with those that draw from smaller areas so that everyone participates in the traffic generated by the stores that attract the most consumers to the center; also, stores that are compatible and might share customers are located conveniently in the center; competing uses are balanced and located to enhance the draw of each retailer. |
|
|
Term
| Describe the kinds of data needed for each of the three methods of drawing and evaluating a retail trade area. |
|
Definition
Population and expenditure—required sales $/SF, per capita dollars spent on a type of good or service, population an income data.
Drive-time—required sales $/SF, per capita dollars spent on a type of good or service, typical time consumers are willing to drive for the good or service.
Traffic count-- required sales $/SF, average transaction amount, percent of customers in store who purchase, percent of passing traffic that enters a given type of store, volume of traffic that passes a store’s location. |
|
|
Term
| Describe the distinguishing feature of a retail percentage lease. |
|
Definition
| In addition to a base rent, the retail user is charged an amount based on a percentage of sales generated on the user’s premises. |
|
|
Term
|
Definition
| In the retail space business, supply may be understood as the total footage of occupied retail space in the trade area by specific type of user, or, in other words, the user type’s existing competition. For example, the supply for sporting goods stores would be the total square footage of competing sporting goods stores in the market area. |
|
|
Term
|
Definition
Retail space demand is measured in terms of the store square footage needed to meet the demand for specific goods or services. Thus, to measure demand it is necessary to:
estimate the demand in dollars for the product or service.
convert the dollar demand into a square footage number using average sales per foot of the type of store that sells the particular product or service. |
|
|
Term
|
Definition
| The comparison of supply and demand for a type of retail space may reveal unmet demand, or a market gap. The gap is the difference between the square footage of occupied space selling the type of product and the total square footage supported by the estimated dollar demand for that type of product. |
|
|
Term
| Give some reasons why growth vectors, demographic patterns, geographical boundaries, and traffic patterns are important to retail real estate owners and users. |
|
Definition
| Growth vectors indicate where future retail demand is likely to come from. Demographic patterns—population, income, makeup, spending patterns—indicate the retail demand potential of the market area. Geographical boundaries create physical sectors in a market that may determine or interfere with retail consumer activity. Traffic patterns indicate the potential for attracting retail business to a location. |
|
|
Term
| Give a brief explanation of how retail space supply and demand are estimated for a trade area. |
|
Definition
Supply is the total occupied square footage in the area for a type of retail use, estimated by totaling the areas of all stores selling the type of good or service in the area.
Demand is estimated by first deriving the total amount spent in the area on the type of good or service from demographic and market data, then converting the dollar amount to square feet by applying a number for average sales dollars per square foot achieved by stores that sell the type of good or service in the area. |
|
|
Term
| Describe the basic procedure for identifying a retail market gap. |
|
Definition
| For a particular type of retail use, identify the demand in total dollars within the market or trade (find the number of households; multiply by the average amount spent per household on the type of good or service). Identify the average sales $ per square foot for the type of retail use (from industry data). Identify the total occupied square feet in the trade area for the type of use (from personal survey or available data). Divide the demand dollars by the sales dollars per square foot to get the square footage equivalent of total demand. Subtract the total existing square feet to see if there is an unmet demand (the gap), as measured in square feet. |
|
|
