CASE STUDY The Retail Property Manager

Henry Palmer, owner of Palmer Properties Associates, asked Bud Lowe, a property manager, to review the management of a Palmer Properties shopping center. After a brief analysis of the property, Lowe gave Palmer a preliminary report, stating that the shopping center needed a facelift to remain competitive with newer malls. He also discovered that no escalation clauses had been included in the leases to cover increases in taxes and insurance. Other problems appear to include insufficient maintenance contributions, unenforced percentage rates, and uncoordinated promotional efforts.

Assuming that the shopping center is a one$-$story straight brick wall structure in a U$-$shaped configuration with a canopy running the full length of the building, what are some options for renovations?

a$.$ Change or update signage, replace canopies, and possibly paint selected areas

b$.$ Repave the parking lot and paint rainbows on pavement near entrances

c$.$ Add bike racks near each end of the $U$

Is there anything Palmer or his property manager could do about the lack of escalation clauses?

a$.$ Renegotiate the leases as they expire

b$.$ Absolutely nothing they can do

c$.$ Hold a potluck with all the tenants to discuss rent changes

d$.$ Buy out the tenants or demand higher rents

How could the property manager try to solve some of the other problems mentioned?

a$.$ Invite the Boy Scouts to clean up the mall as part of earning a badge

b$.$ Tour similar malls in the area to brainstorm ideas

c$.$ Make sure the lease is enforced as far as each tenant's maintenance contributions

d$.$ Start a crowd$-$funding campaign on the mall website

CASE STUDY The Industrial Property Manager

Ron Yu is looking for tenants for a business park he manages. The business park is located in an outlying area and is made up of relatively small tenant spaces $($five acres to ten acres$).$ There is no direct access to air cargo transport or railroads, but there is easy access to trucking routes and residential areas.

What kind of tenants should Yu be looking for?

What qualities in a tenant should Yu screen for?