{"id":1004151069,"date":"2016-08-28T11:24:36","date_gmt":"2016-08-28T19:24:36","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004151069"},"modified":"2022-12-05T22:51:20","modified_gmt":"2022-12-06T06:51:20","slug":"recipes-for-success","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/","title":{"rendered":"Recipes for Success"},"content":{"rendered":"

By Justin Berryman & Reid Mason, Avison Young<\/p>\n

\"Justin<\/a>

Justin Berryman<\/p><\/div>\n

\"Reid<\/a>

Reid Mason<\/p><\/div>\n

As all retail real estate professionals know, restaurants are red-hot right now. The total number of restaurants in the U.S. is expected to reach 1 million this year, 100,000 more locations than in 2005. This year, sales will top $783 billion, according to National Restaurant Association estimates.<\/p>\n

While the demand for restaurants of almost all categories is undeniable, picking the right one for your project remains a tricky business. For developers and the brokers who advise them, the choice of food and beverage tenants is as essential to the tenant mix as the selection of in-line stores. and oftentimes determines the success of a property.\u00a0Restaurants usually pay higher rental rates per square foot and generate excellent foot traffic.<\/p>\n

Setting Goals<\/strong><\/p>\n

Though multiple factors determine which restaurant-related tenants are the best fit for a property, the choice ultimately depends on the developer\u2019s goals. We believe that a developer that intends to sell the property for immediate proceeds should target corporate-backed tenants in most cases. The reason is that retail properties that offer a lineup packed with credit tenants tend to sell more quickly and command higher prices than comparable centers lacking those attributes.<\/p>\n

For these properties, the goal of the owner and the agent should be to fill the center with high-rent tenants. The developer is generally willing to pay a higher tenant improvement allowance in order to amplify the cap rate.<\/p>\n

Take the quick-service category, for example. Several popular Mexican-style concepts\u2014Chipotle Mexican Grill, Moe\u2019s Southwest Grill, and Willy\u2019s Mexicana Grill, for instance\u2014invite customers to create entrees from a variety of ingredients to suit their individual tastes. However, selecting the best option isn\u2019t quite so simple.\u00a0 Sometimes it will be a corporate restaurant, and at other times it may be a franchisee with multiple locations.<\/p>\n

For instance, if a developer intends to flip a property quickly, the preferred choice may be a corporate-backed restaurant like Chipotle. However, for a developer planning a long-term hold, a financially strong franchise like Moe’s is the better bet. The challenge for the broker and developer is to determine on a deal-by-deal basis which restaurant tenant is able to pay the highest rent and provide the strongest credit.<\/p>\n

The same analytical approach holds true for another increasingly popular market segment, the fast-casual category. These restaurants typically require space ranging from 1,500 to 2,500 square feet, with multiple concepts vying for available space, particularly in new developments. It\u2019s up to the broker and the developer to determine the best fit based on credit, the number of similar tenants in the market, and the experience of the owner or operator that would oversee the concept.<\/p>\n

In general, most retail developers today are trying to sell their projects as quickly as possible to take advantage of low interest rates and the relatively small inventory of\u00a0product on the market. For that handful of project sponsors planning a long-term hold, which offers the flexibility to incorporate more franchisees and unique local tenants.<\/p>\n

Wise Owl\u00a0<\/strong><\/p>\n

In Kennesaw, Ga., part of the metropolitan Atlanta market, we are working with a local developer on a new 17,000-square-foot center called Owl Creek Commons (the name is a tip of the hat to the mascot of nearby Kennesaw State University). Together with the developer, we created a plan to bring restaurant concepts to four of the seven available spaces in the center.<\/p>\n

With that in mind, we identified concepts that would be willing to pay premium\u00a0rents but could also provide strong guarantees in the event the developer decides to bring the property market earlier than anticipated. After working on several other nearby retail projects in prime locations, we were able to advise our client\u00a0on which\u00a0popular brands were seeking to expand or enter the market. The upshot was that Chipotle Mexican Grill, Capriotti\u2019s Sandwich Shop, Taziki\u2019s Mediterranean Caf\u00e9 and Tropical Smoothie Caf\u00e9 all signed leases at Owl Creek Commons, and only one 1,850-square-foot space remains.<\/p>\n

We’d like to leave you with a final thought. When a retail project first starts coming to fruition, it\u2019s imperative that the developer takes the time to find a broker who understands their goals. Brokers who know which retail tenants are in the hunt for space, where they want to go and what they need give their developer clients a leg up on competition and eliminate some of the risk associated with new developments. By working together to create the best possible tenant mix from the start, the sponsor and adviser greatly raise the odds of developing a successful project that meets\u00a0the developer\u2019s goals.<\/p>\n

\u00a0<\/em>Justin Berryman and Reid Mason are Atlanta-based directors with Franklin Street, a diversified real estate services company. They specialize in retail landlord representation and leasing throughout Georgia, Eastern Alabama, and Southern Tennessee. In the last two years, Berryman and Mason have advised clients on 10 developments in Greater Atlanta ranging in size from 10,000 to 150,000 square feet.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Is a financially strong franchise or a corporate-backed restaurant the best choice for a new retail center?<\/p>\n","protected":false},"author":1649,"featured_media":1004151075,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21749,21684],"tags":[],"class_list":["post-1004151069","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-retail","category-viewpoint"],"acf":[],"yoast_head":"\nRecipes for Success - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Recipes for Success\" \/>\n<meta property=\"og:description\" content=\"Is a financially strong franchise or a corporate-backed restaurant the best choice for a new retail center?\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2016-08-28T19:24:36+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-12-06T06:51:20+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/08\/justin-berrymant-457x296.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"457\" \/>\n\t<meta property=\"og:image:height\" content=\"296\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Reid Mason\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/\"},\"author\":{\"name\":\"Reid Mason\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#\\\/schema\\\/person\\\/fa025947beacbd1c584bfb0ac8cc22ee\"},\"headline\":\"Recipes for Success\",\"datePublished\":\"2016-08-28T19:24:36+00:00\",\"dateModified\":\"2022-12-06T06:51:20+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/\"},\"wordCount\":850,\"image\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2016\\\/08\\\/justin-berrymant-457x296.jpg\",\"articleSection\":[\"Retail\",\"Viewpoint\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/\",\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/\",\"name\":\"Recipes for Success - Commercial Property Executive\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2016\\\/08\\\/justin-berrymant-457x296.jpg\",\"datePublished\":\"2016-08-28T19:24:36+00:00\",\"dateModified\":\"2022-12-06T06:51:20+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#\\\/schema\\\/person\\\/fa025947beacbd1c584bfb0ac8cc22ee\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/#primaryimage\",\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2016\\\/08\\\/justin-berrymant-457x296.jpg\",\"contentUrl\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2016\\\/08\\\/justin-berrymant-457x296.jpg\",\"width\":457,\"height\":296,\"caption\":\"Justin Berryman\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/recipes-for-success\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Recipes for Success\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#website\",\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/\",\"name\":\"Commercial Property Executive\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#\\\/schema\\\/person\\\/fa025947beacbd1c584bfb0ac8cc22ee\",\"name\":\"Reid Mason\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/b790905ec70b770bd4315ee60ec39e0d2ee9163c88a1d52f39c5d4cce702b1b6?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/b790905ec70b770bd4315ee60ec39e0d2ee9163c88a1d52f39c5d4cce702b1b6?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/b790905ec70b770bd4315ee60ec39e0d2ee9163c88a1d52f39c5d4cce702b1b6?s=96&d=mm&r=g\",\"caption\":\"Reid Mason\"},\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/author\\\/reidmason\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Recipes for Success - Commercial Property Executive","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/","og_locale":"en_US","og_type":"article","og_title":"Recipes for Success","og_description":"Is a financially strong franchise or a corporate-backed restaurant the best choice for a new retail center?","og_url":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/","og_site_name":"Commercial Property Executive","article_publisher":"https:\/\/www.facebook.com\/CPExecutive","article_published_time":"2016-08-28T19:24:36+00:00","article_modified_time":"2022-12-06T06:51:20+00:00","og_image":[{"width":457,"height":296,"url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/08\/justin-berrymant-457x296.jpg","type":"image\/jpeg"}],"author":"Reid Mason","twitter_card":"summary_large_image","twitter_creator":"@cpexecutive","twitter_site":"@cpexecutive","schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/#article","isPartOf":{"@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/"},"author":{"name":"Reid Mason","@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/fa025947beacbd1c584bfb0ac8cc22ee"},"headline":"Recipes for Success","datePublished":"2016-08-28T19:24:36+00:00","dateModified":"2022-12-06T06:51:20+00:00","mainEntityOfPage":{"@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/"},"wordCount":850,"image":{"@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/#primaryimage"},"thumbnailUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/08\/justin-berrymant-457x296.jpg","articleSection":["Retail","Viewpoint"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/","url":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/","name":"Recipes for Success - Commercial Property Executive","isPartOf":{"@id":"https:\/\/www.commercialsearch.com\/news\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/#primaryimage"},"image":{"@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/#primaryimage"},"thumbnailUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/08\/justin-berrymant-457x296.jpg","datePublished":"2016-08-28T19:24:36+00:00","dateModified":"2022-12-06T06:51:20+00:00","author":{"@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/fa025947beacbd1c584bfb0ac8cc22ee"},"breadcrumb":{"@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/#primaryimage","url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/08\/justin-berrymant-457x296.jpg","contentUrl":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/08\/justin-berrymant-457x296.jpg","width":457,"height":296,"caption":"Justin Berryman"},{"@type":"BreadcrumbList","@id":"https:\/\/www.commercialsearch.com\/news\/recipes-for-success\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.commercialsearch.com\/news\/"},{"@type":"ListItem","position":2,"name":"Recipes for Success"}]},{"@type":"WebSite","@id":"https:\/\/www.commercialsearch.com\/news\/#website","url":"https:\/\/www.commercialsearch.com\/news\/","name":"Commercial Property Executive","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.commercialsearch.com\/news\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/fa025947beacbd1c584bfb0ac8cc22ee","name":"Reid Mason","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/b790905ec70b770bd4315ee60ec39e0d2ee9163c88a1d52f39c5d4cce702b1b6?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/b790905ec70b770bd4315ee60ec39e0d2ee9163c88a1d52f39c5d4cce702b1b6?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/b790905ec70b770bd4315ee60ec39e0d2ee9163c88a1d52f39c5d4cce702b1b6?s=96&d=mm&r=g","caption":"Reid Mason"},"url":"https:\/\/www.commercialsearch.com\/news\/author\/reidmason\/"}]}},"jetpack_featured_media_url":"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2016\/08\/justin-berrymant-457x296.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004151069","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/users\/1649"}],"replies":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/comments?post=1004151069"}],"version-history":[{"count":1,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004151069\/revisions"}],"predecessor-version":[{"id":1004531642,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/posts\/1004151069\/revisions\/1004531642"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/media\/1004151075"}],"wp:attachment":[{"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/media?parent=1004151069"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/categories?post=1004151069"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.commercialsearch.com\/news\/wp-json\/wp\/v2\/tags?post=1004151069"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}