Curation to Agglomeration

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In the retail life cycle, the mix of tenants in a shopping center can contribute to success as much as location or condition. A well matched combination of design and leasing focus can instill a consistent, complimentary theme for ready market response.

You see this on a community basis most often with power centers, but the same principle applies more locally in food anchored centers with proximate smaller tenants offering neighborhood services.

Newer curated developments seek to offer tenants with similar quality product lines:

  • High end kitchen, bath, and furnishings anchors along with a few attendant skilled providers such as cabinet, flooring and design firms.

  • Value themed anchors with off price clothing, shoes, home goods, and even discount tools.

  • Well branded convenience oriented centers containing smaller tenants like fast casual  restaurants, personal service salons, and neighborhood services such as insurance and   cleaners. The best of this type of locally oriented centers are usually very close to the high end power properties.

Completing the life cycle, at some point older retail centers are relegated to attempting to attract any tenant. I call this agglomeration, as contrasted to curation. They attract almost exclusively dollar themed discounters and local tenants by altering former anchors to smaller spaces. Churches and event centers also fill the larger spaces.

For the Assessment Professional, it pays to look hard at land value and alternate use for those properties well into the agglomeration phase. Is it really a retail property now? Highest and Best Use always rules!