27 Jan Commercial Real Estate – Expansion Strategy
People often ask me, if I am expanding retailer what is the best expansion strategy? The reality is there is not a singular answer to this question, a whole host of factors go into determining the best strategy for a particular retailer. Some of the obvious constraints could be access to capital, proof of concept, the availability of compatible sites. One path could be that of an acquisition strategy.
An investment strategy for an expanding retailer could involve several different tactics, depending on the retailer’s specific goals and resources. One approach that could be considered is the acquisition of existing properties. This could include purchasing stand-alone retail buildings or shopping centers that are already leased to other retailers, as well as acquiring properties that are currently vacant but have the potential to be leased to other businesses.
Another strategy that could be considered is the development of new properties. This could involve building new retail centers from the ground up, or renovating and repositioning existing properties. This approach could be particularly attractive for retailers looking to enter new markets or expand into areas where they currently have little presence.
A third strategy to consider is to invest in properties that have been underutilized or mismanaged, and repositioning them to attract good co-tenants and increase their income potential.
Additionally, retailers should consider the long-term prospects of the area in which they are investing. This could include factors such as population growth, economic conditions, and the strength of the local retail market.
Finally, retailers should also consider working with local and regional brokers and developers, as well as real estate investment trusts (REITs) to help identify and evaluate potential properties. These partners can provide valuable market insights, as well as access to properties that may not be available through traditional channels.
In conclusion, there are several different commercial real estate investment strategies that an expanding retailer could consider. The most effective strategy will depend on the retailer’s specific goals and resources, as well as the local market conditions. Some important elements to consider include location, property condition, and the long-term prospects of the area. A combination of different strategies such as acquisition, development, repositioning, and working with partners will provide the best chance for success.
Have questions? Interested in learning more? Reach out to an Iconic agent today and get some answers and make some moves.
Thank you for reading.
Kees Janeway – Managing Partner, ICONIC Real Estate