At a time of tight supply for retail space, landlords are more likely to be open to making available to prospective tenants the shops now occupied by struggling operators, according to Hue Chen, president of shopping center owner Saglo Cos.
In the United States, the overall vacancy rate is 4.2% for the country's 12.1 billion square feet of retail space, and that's led to increased competition among occupiers, according to a report from CoStar Market Analytics. More space, however, could be made available at centers owned by landlords willing to actively replace poorly performing retailers, Chen said in an interview.
For brokers seeking prime spaces for their clients, it would be smart to call shopping center owners of properties that are 100% leased "to find out if any of the tenants are weak" performers or behind on rent, occupying spaces known as "shadow inventory" that could be made available, he said.
Saglo, the South Florida firm that owns shopping centers from Maryland to Florida, where its holdings include Sun Point Shopping Center near Tampa, is seeking to enter new markets, Chen said.
Watch the video to see where Saglo is considering expansion and how the company decides on the markets to enter.