We help retailers find space all over the Upstate, and not all retailers want to be downtown (a.k.a. the Central Business District or CBD). The dynamics of downtown Greenville are a big draw as you have the largest daytime population in the area, about 30,000, within a one-mile ring, combined with a permanent population of over 8,000 in the same area. With all the new apartments and condos under construction, the number of full-time residents is increasing significantly.
There is a large range in the rental rates in the CBD. We are seeing rental rates from $12/SF to the high $30s/SF, plus operating expenses. Location and condition of space is driving this rental rate. Vacancy rates are trending downward and are lower in the CBD than the Greenville area as a whole. This drives the corresponding rents higher as a function of supply and demand.
When downtown retailers are looking for space to lease, there are several factors to consider. The big questions:
Will my customers be OK not parking directly in front of the store or paying to park?
If a retailer cannot find an available space right on Main Street, will they be seen and do OK on a side street? How far down in the West End can you go and still catch enough pedestrian traffic to be successful?
Can the retailer take advantage of daytime population (primarily office employees)?
With strict sign ordinances in the CBD, can I make signage needs work?
Will the space work for my type of business? If not, what are the costs to make it work? Will the landlord pay for this or will this be a requirement of the tenant? (Note: the cost to build out the infrastructure can be high, depending on the type of business.)
Once a retailer has identified a space, here are some tips to keep in mind during lease negotiations:
Include options to renew the lease at a predetermined lease rate.
This way, the business can plan long term and there will be no surprises or rent spikes down the road. This also protects the tenant against getting kicked out after the initial lease term expires. The tenant always has the option not to exercise this if they don’t want it.
If the space needs work, the tenant should try to negotiate a Tenant Improvement Allowance to help them get the space built out to their needs.
They should also set the rent payment to start after they are open for business so they are not paying rent before starting to make income.
With vacancy rates low, it is harder to negotiate now, but ask for an early termination option.
This is useful if the business needs to close or relocate prior to the expiration of the initial lease term.
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