Retail Tenants Pushing the Envelope

By Carrie Rossenfeld for Globe St.

WALNUT CREEK, CA-It used to be that department-store and big-box retailers ruled the shopping-center arena, but these days retailers of much smaller size are calling the shots with their landlords, according to Hans Lapping, an attorney and partner with Miller Starr Regalia here. Whether acting out of fear or a perceived advantage over developers, smaller retailers are acting like mini anchors, often using each other for mutual advantage by insisting on co-tenancies galore and making demands on landlords. The result: Landlords’ scrambling to meet these retailers’ demands in order to lease up shopping centers as the market recovers.

“The good news is that now there is deal flow again, as opposed to a couple of years ago when retailers put the kibosh on some deals,” Lapping tells GlobeSt.com. “While Target, Apple and other name-brand companies that frankly appear to be recession proof continued to do deals, most retailers stayed on the sidelines and didn’t expand much, based on the economy as a whole.”

However, says Lapping, in the last three to four months, there has been in increase in deal flow as retailers return to the marketplace and look to expand their existing footprint. But they haven’t forgotten their recent economic woes. “There’s still some trepidation on the part of the retailers. They don’t want to be the first one into a shopping center, and they don’t want to be the last one out.”

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