National Retail Tenants - New York City

Real Estate Agent · New York City · Member since 2020 · 819 posts · 641 votes

3y

It is common in this market for landlord to give generous Tenant Improvement budgets to attract high quality / long lease tenants.

The timeline will depend on your build requirements but also how well priced or poorly priced (i.e. expensive) the space is and how motivated a tenant will be.

Have you considered a non-national food and beverage tenant?

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Carmelo LoPresti

OP

Member since 2023 · 2 posts · 1 vote

3y

Thank you for your reply and insight.

We're definitely open to other tenants.

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Mohammed Rahman

Real Estate Broker · New York, NY · Member since 2020 · 2k+ posts · 1k+ votes

2y

Hey @Carmelo LoPresti shoot me a DM if you're serious about chatting. I'm an investor and broker in NYC and have worked on both on-market and off-market commercial listings.

The answers to your questions can never be explicitly answered because commercial real estate is so subjective.

For example, you might be open to providing "free rent" to your potential tenants in hopes to get them to sign a long term lease - especially if they're a national brand.

Alternatively, you might also consider giving a chance to smaller brands but in return they provide you a lump sum of "key money" up front in order to secure the lease for their own company.

Lots of different factors, anyone giving you a black/white solution probably doesn't understand what you're trying to accomplish.

Shoot me a DM, happy to chat about what your actual goals are and advise you in the right direction. Thanks.@Carmelo LoPresti

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Ronald RohdePro Member

Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes

2y

Yes, 1-2 years easily.

I would expect substantial TI coming from a dry cleaner to a national tenant.

Work with a broker on this deal, then decide for the second one.

2 Reply

Kristi KandelPro Member

Developer · Fort Myers Beach, FL · Member since 2018 · 383 posts · 195 votes

2y

Quote from @Carmelo LoPresti:

Hello,

I'm researching information on the process of attracting a national retail tenant on a 4 story brownstone in midtown Manhattan.

It would be a ground floor commercial space, approximately 1,000 SF with a small outdoor area in the rear.

The space is currently occupied by a dry cleaner. The idea is to lease the space to a store front tenant like Verizon, AT&T, Dunkin, or something similar and secure a long term lease.

Here's what I understand so far:

- Work with a commercial retail broker that can bring leads.

- It could be a long process - but what is long? 1 year, 2 years, etc.? Anyone from the NYC area knows anything related to construction can take a long time with approvals, permits, etc.

- Is the building owner always responsible for renovation costs when leasing to a national retail company, or does that depend on the company leasing the space?

Basically, I'm looking for some insight into how the process works, if anyone has any further information they can share it would be appreciated.

Thank you.

This is a very loaded question. I would recommend finding and vetting commercial brokers in this market to help educate you.

1. you have a property that has a dry cleaner which means you have environmental issues to address prior to any other retailers or food user coming in. This can get VERY $$$.

2. the 1000 SF is VERY small and national tenants do not want to deviate from their prototype unless the property is in an area they can't get into otherwise

3. The way you deliver the space to the tenant depends upon the deal you negotiate with them. That is all defined in the LOI and future lease with a WORK LETTER exhibit stating how the LL is delivering the space to the Tenant.

4. The timing is based on the level of work you're doing and how that city permits that type of project in that zoning. Assuming you have the correct zoning and the use is permitted by right AND you're not going to modify the structure of the building then you could have a very simple zoning process and then do permitting for the work that the LL is responsible for.

5. You can deliver a vanilla shell or grey shell to the Tenant and that again goes back to the work letter and the deal you negotiate with the Tenant.

I've worked with national tenants my entire 17 year career and while it sounds great they are also very ridged in their processes and might not always be the best solution. CVS, Chase, Family Dollar, Starbucks, Coffee Bean, ALDI, Dunkin, etc.

2 Reply

Michael K GallagherBusiness Member

Real Estate Agent · Columbus OH · Member since 2018 · 1k+ posts · 1k+ votes

2y

@Carmelo LoPresti

I've not worked in NYC yet, but in general when we are looking for space for our clients it comes down to the data for us. There has to be a retail draw to that area, and the trade area/population densities have to support an additional retail space of that type. So you'd need to have a good picture of the area demographics and the competition footprint of the national tenant you are trying to attract.

In general you're going to have a pretty high TI going from Dry cleaner to retail.

Out of curiosity why switch uses? could you go for a national credited dry cleaner? Or is the current tenant able and willing to renew at a rate and term that makes it attractive.

[email protected]614-362-2231

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National Retail Tenants - New York City

National Retail Tenants - New York City

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