Coreland’s Ben Terry: Leasing Realities of Fast-Moving Food Trends
By Dennis Kaiser
The growth of the fast-casual restaurant sector and rapidly evolving food trends have benefited the retail industry, while presenting new leasing challenges. Connect Media asked Coreland’s Ben Terry, Vice President of the firm’s retail brokerage division, to share insights into the trends driving this retail sector.
Q: Food and dining concepts have emerged as a driver within the retail sector. How is this changing the dynamic for landlords?
A: Competition in the restaurant industry is at an all-time high. There is great demand for quality, convenience and personalization. Like traditional retail, consumers are drawn to specialty and moving away from generalists ̶ no longer interested in one-stop shops like Sears, and choosing specialty cafés over the old general American fare such as Claim Jumper or Applebee’s.
With new food concepts popping up daily, there is much more demand for space in the market than supply. Landlords are in a position to be selective in terms of tenant variety.
Q: What does the term ‘Embrace Different’ mean in today’s food-driven retail environment?
A: Consumers today are so much more adventurous, craving international flavors and specialties that were overlooked in the past. Look no further than the Poké craze or the group of Ramen concepts positioning themselves to enter the market. Even in the coffee and tea category, unique concepts are seeing tremendous success over branded counterparts. Reborn Coffee, with two Southern California locations, recently won America’s Cold Brew Competition.
Welcoming new concepts can completely reinvigorate a shopping center and strengthen leasing efforts. However, a risk of integrating trendier concepts is that on occasion a concept might not succeed. While these operators may not have substantial collateral, landlords should focus on the fundamentals. Evaluate the operator, menu and concept, and ensure there is enough working capital to successfully open and run the business.
Q: What are some of the ways landlords can mitigate the risks associated with new concepts?
A: Having the right infrastructure in place, such as a hood system, grease interceptor and walk-in freezer, will make it less painful to replace concepts down the line. The reality is that many new concepts can operate with a generic kitchen build-out, making them much more flexible than national brands and reducing costs.
Protect exclusives in lease negotiations. Don’t giveaway general exclusives such as “no pizza” or “no soy sauce-based food” that would take away new concept opportunities. Be primary food specific and specify style of restaurant. Be sure to carve out of the exclusive similar concepts that don’t directly compete.
Dennis Kaiser is Vice President of Content and Public Relations for Connect Commercial Real Estate. Dennis is a communications leader with more than 30 years of experience including as a journalist and in corporate and agency marketing communications roles. He is responsible for Connect’s client content operations and is involved in a range of initiatives ranging from content strategy, message development, copywriting, media relations, social media and content marketing services.
In his most recent corporate communications roles, he led a regional public relations effort across Southern California for CBRE, played a key marketing role on JLL’s national retail team, and was responsible for directing the global public relations effort at ValleyCrest, the nation’s largest commercial landscape services company.
In addition to his vast commercial real estate experience, Dennis has worked on communications and launch strategies for a number of residential projects such as Disney’s Celebration in Florida, Ritter Ranch in Palmdale California (7,200 homes, 22,000 acres), WaterColor in Florida and PremierGarage in Phoenix.
Dennis’s agency background included firms such as Idea Hall and Macy + Associates. He has earned an outstanding reputation with organization leaders as a trusted advisor, strategic program implementer, consensus builder and exceptional collaborator.
Dennis has developed and managed national communications programs for Fortune 500 companies to start-ups, both public and private. He’s successfully worked with journalists across the globe representing clients involved in major-breaking news stories, product launches, media tours, and company news announcements.
Dennis has been involved in a host of charitable and community organizations including the American Cancer Society, Easter Seals, BoyScouts, Chrysalis Foundation, Freedom For Life, HOLA, L.A.’s BEST, Reach Out and Read, Super Bowl Host Committee, and Thunderbirds Charities.
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