What's the difference between office and retail?

Question

I have a property on a busy street that could be used for what I would consider either office or retail use. In fact there are properties right around it that are used for both, a flower shop, a tattoo shop, an accounting office, an insurance office all in the same type of properties right next door.

So that got me wondering is there some kind of criteria used in classifying properties as office or retail? Is it if you sell a service or product? Is it if the business works in a high visibility site versus one slightly off the beaten path?

Joel Owens · Answer

Sometimes things like medical office can be mixed use. Generally retail has higher per sq ft lease rates and are on triple net leases (base plus cam). Office spaces generally rent for less per sq ft and are usually some type of gross lease. Medical office rivals retail in per sq ft lease rates but as the landlord the tenant improvements are substantial.

Patrick Liska · Answer

Jeff,

The difference is the definition in zoning - office is just as you suspect, it can be a business that operates out of a space but does not sell the product to the public from the space ( you can not walk in and shop), Retail is someone that sells a product or products from that space where you can walk in and buy something from the shelf. If you want to, checking with your zoning office on what defines the difference.