Despite declining retail vacancy rates, it?s still a tenant?s market throughout the Sacramento Commercial Real Estate landscape. The overall Sacramento retail vacancy rate dropped slightly to 9.8% during the 2nd Quarter of 2012, according to Voit Real Estate Services, who was recently quoted by the Sacramento Bee. This represents the second quarter in a row that commercial retail vacancy ended below 10%. According to the same source, commercial real estate vacancies within the Sacramento submarket of Carmichael reflect a much higher level of 11.3%. This phenomenon of higher retail vacancy rates often creates dramatic opportunities for businesses to sign commercial real estate lease transactions that are quite favorable to tenants.
One recent example involves a franchisee of a national company, who benefitted from a commercial real estate market that currently favors tenants throughout the Sacramento area. In late January 2012, Melisa Nelson acquired her first Curves franchise (ladies fitness gym), which had operated at 4141 Manzanita Ave in Carmichael for almost 10 years. The commercial lease would be expiring only seven months later, so Ms. Nelson had to determine whether to renew the lease for another five years or find a better location. The existing facility was part of a small neighborhood strip center with limited visibility and low traffic that had become mostly vacant with only a handful of tenants remaining in place.
After engaging Brian Jacks with East West Commercial Real Estate of Sacramento for commercial retail leasing representation, Ms. Nelson was presented with several different options that would create a better overall leasing package. In the end, she signed a new commercial retail lease with Tsakopoulos Investments for a 1,400 sq. ft. shop space in Carmichael Village at 4005 Manzanita Ave in Carmichael? right across the street from her former location. Carmichael Village is a large shopping center, anchored by Bel Air, an upscale grocer operated by Raley?s. The center is almost entirely full with complementary tenant uses that will drive more traffic to the Curves franchise. The new location opens September 1, 2012.
In addition to securing a fantastic commercial real estate location with excellent visibility within a very busy and thriving commercial shopping center, Ms. Nelson benefitted in the following financial aspects. Her new combined monthly rent plus landlord expense reimbursements were reduced by 12%, as compared to her former lease. In addition, she received three months of free rent plus 45 days early occupancy for signing a 53-month lease.
In October 2011, the Sacramento office of East West Commercial Real Estate signed a renewal lease for a separate Curves franchise in Antelope, which resulted in a 20% reduction in base rent, plus 50% off (half rent) for the first 6 months of a 3-year lease.
The latter example suggests that while the best commercial real estate deals in Sacramento may have passed, there are still great opportunities to negotiate terrific retail leases within the Sacramento commercial real estate sector.
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Article source: http://www.sacramentopress.com/headline/71400/Compelling_Retail_Leasing_Opportunities_Abound_for_Tenants_in_the_Sacramento_Commercial_Real_Estate
Source: http://www.rankinrealty.net/2012/07/compelling-retail-leasing-opportunities-abound-for-tenants-in-the-sacramento/
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