Pop-Up Retail: A Rising Retail Trend

The pop-up store — the short-term or temporary appearance of retail operations, inside or outside of traditional retail space — is a bona fide disruptive trend in retail space markets.  With so many changing expectations reshaping what was once a predictable lock-em-up business formula, how can landlords and reps handle the upheaval?  How can value be added, risk curtailed, and deals made?

The increase in temporary retail space is not chalked up to any single factor.  Local and national economic factors, a surplus of vacant retail space, and a rise in business flexibility afforded by wireless mobile technology are all working to create a different kind of opportunity.  Thinking past traditions like the five-year lease is a bare minimum.

Recognize the familiar The Halloween or Christmas store is already a familiar seasonal mall fixture.  Spring and summer are the season for bridal stores, and late summer is back-to-school territory.  Think of how these operators see the world and use space, and extend this thinking by looking for prospects who could be comfortable with that footprint.  Be prepared by considering allowances for sign-wavers or large banners to attract attention.

Understand all the online implications  The omnipresent mobile web enables tenants and space providers to use marketing concepts and to support retail operations undreamed of in the past.  Social networks, properly grown and tended, can put hundreds of people in a physical space in a tight timeframe with the right enticement.   Space providers can also add value by providing wireless internet access to tenants in temporary spaces to support point-of-sale solutions that these days can appear complete as single smartphones.  Remember to be ready for the online fallout: online mapping applications like Google Maps will keep listings longer than the store will be open.  Bring this up in negotiations and get ahead of the problem by writing better listing copy or by controlling listings appearance.

Be ready to bend, but not break the “rules”

Distressed downtowns are a big driver of the pop-up retail play. Because the need to handle risk doesn’t change fundamentally with pop-up – it’s going to be up to landlords in such situations to calculate the value of renting a temporary store mainly in order to turn the lights on in a darkened property.  With almost no exceptions, lights on is better than lights off, meaning a pop-up deal including tenant improvements might restore your mall to a showable state and even serve potentially as a loss leader toward gaining a long-term tenant attracted by the hubbub.   While the business norms of pop-up are still being defined, reduced lease terms do mean less likelihood of financing.  Foregoing financing means it becomes even more important to get the consumer-attracting parts right.  What might be a stretch today could not only be commonplace tomorrow, it could be the new definition of success.


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  • David Tod

    March 14, 2012

    The sheer volume and range of online companies and even online brands is so diverse that a new format of creating a physical presence on the high street or in the malls just has to be seriously considered as part of the retail mix for many Landlords. Pop-ups will not solve the problem of empty shop alone and it will not replace traditional 5 year lease rent as for many large retailers this model is important to their business planning however it is certainly a viable and sustainable aspect of the bigger picture in property.

  • Jason Sandquist

    March 14, 2012

    Two pop-up retail ideas that I like are: Popuphood in Oakland and Boxpark in the UK.

    • admin

      March 16, 2012

      Thanks for the tips on these, Jason. I’ll be looking more closely.


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