Vacant commercial spaces have always been an issue for brokers in the real estate market. After the Covid-19 pandemic struck in 2020, many businesses were forced to shut their doors for good. This led to an increase in the number of vacant commercial spaces throughout the world.
The question that commercial brokers have been asking throughout history remains—how can they find new opportunities for vacant commercial spaces? Here, 11 members of Forbes Real Estate Council share their expert opinions.
1. Remain Visible To Get Connected
Finding new opportunities for vacant spaces often depends on the confluence of timing, connectedness and visibility. One never knows when a new opportunity will come along. The best way to get connected is to be visible—in the industry, business and community. Visibility isn’t easy and doesn’t come overnight, but in time it will pay off and help commercial brokers deliver solutions. – Andrew Hochberg, Next Realty, LLC
2. Look For Possibilities To Repurpose
Look for repurposing possibilities and do more leg work on feasibilities. This means you can open your traditional office, hotel or retail market to a new set of clients such as apartment investors, etc. – Elisa Zhang, EZ Real Estate
3. Consider Converting To Self-Storage
Those in the self-storage business are aggressively pursuing vacant commercial warehouse spaces to convert to self-storage. We have also been successful in buying with the potential to reposition, say, a 100,000 sq. ft. commercial building into 10 commercial spaces. These strategies have proven to be viable in this space. – Scott Meyers, Kingdom Storage Holdings
4. Look At Master Lease Scenarios
Vacant commercial spaces cost the owner untold carrying expenses. Brokers can and should look at master lease scenarios (and possibly even have a purchase option attached). The lessee will typically take on the property on a NNN basis, then stabilize the property with good credit tenants and even self-manage it. This lets the owner know the lessee is incentivized to take care of the property. – Steve Alkandros, New England Management Group/AR Property Services, LLC
5. Consider Mixed-Use Conversion
The current real estate landscape is ripe for innovation. We are working with several real estate companies focused on accessing federal and state dollars dedicated to increasing the affordable housing market. Many commercial properties are eligible for mixed-use or residential conversion to meet state goals for new housing. Low interest rates and deferred capital gains are some of the great benefits available. – Susan Leger Ferraro, Peace, Love, Happiness Real Estate
6. Find Nontraditional Tenants For Backfill
Social media, geofencing, void analysis and emerging-trend research have allowed us to find nontraditional tenants to backfill commercial space. Hospitals decentralized into local markets, micrologistic centers, shared office space and a growing F&B market offer a new stable of potential tenants. Recent stimulus has also spurred growth, as folks trade in their 9-to-5 jobs to pursue entrepreneurship. – James Prendamano, Casandra Properties, Inc,
7. Create Value In Important Ways
Vacant space will stay vacant if it’s not equipped with the latest technology. No one wants to share phones, handsets or common keyboards anymore. The likely solution is the use of personal mobile phones and laptops. Help lessors evaluate and equip spaces with the latest technology and then market the capability. – Richard Lackey, City Commercial Real Estate, Inc.
8. Reimagine Vacant Commercial Spaces
Today’s market calls for an in-depth understanding of opportunities to reimagine vacant commercial spaces. Industries impacted by the last year’s challenges can offer new businesses opportunities to utilize adaptive reuse of empty spaces. – Adam Mopsick, Amicon
9. Network With Business Owners
Network with business owners that could be potential users, commercial brokers that can bring buyers or tenants and even residential realtors who can refer a client. People always focus on new tech, but one of the most effective methods of marketing remains your sphere of influence. Have conversations with people. They may just know someone who can utilize the space or have a new business idea. – Catherine Kuo, Elite Homes | Christie’s International Real Estate
10. Get Involved With The Chamber Of Commerce
While a membership to a chamber of commerce is unlikely to help with finding opportunities, getting connected to business owners that are members of the chamber of commerce will give an edge in knowing when a business is likely to move or close. This will lead to having an open commercial space ready for a new motivated consumer. – Marco Del Zotto, LIV | Sotheby’s International Realty – Breckenridge CO
11. Investigate The Zoning
Examine the zoning—does the property have zoning in place that would allow for vertical expansion or to accommodate both residents and commercial use? If there isn’t in-place zoning, what would be the ideal type of zoning for the location and product? Seek out the Alderman or local official to begin a discussion into that possibility. – Lee Kiser, Kiser Group