CBM’s Retail Shopping Center Management & Leasing Blog

Retail Real Estate News & Trends in Southern California
 

Anaheim, CA – October 2019, Centers Business Management (CBM) completed a leasing transaction with Crunch Gym in a large-scale strip center on Soledad Canyon in prime Santa Clarita

CBM Valley Division Director, Dave O’Connell, recently completed a lease transaction, representing the landlord and tenant in a deal with a 20+ unit franchisee of Crunch Fitness. Crunch, an international fitness club operation, will occupy a 23,260 SQFT space in a newer, well-maintained retail shopping center that stretches nearly a full block along Soledad Canyon Boulevard in prime Santa Clarita. The sprawling, multi-pad center hosts a retinue of A+ national and regional tenants, including T-Mobile, IHOP, Domino’s Pizza, Kumon Learning Centers and more.

Founded in 1989 in New York City, Crunch Gym currently boasts 265+ locations, many franchisee-owned and operated, throughout the United States, Canada, and Australia. The organization is growing steadily, with franchisees continuing to open new locations in both the United States and abroad.

UFC Gym, another national fitness franchisor, originally leased the Soledad Canyon space and later engaged in a co-branding arrangement with Crunch. “The co-branding partnership was a prudent move, but unfortunately came too late,” says CBM’s Dave O’Connell, adding “The UFC operator was at that point undercapitalized and struggling to meet his lease obligations.” Crunch recognized the site’s potential and was keen to step in when approached. But disturbing the existing membership-base with a with facility closure was not an option. “An intense three-party negotiation followed, which yield an agreement that was a win for all parties involved,” O’Connell notes. “Crunch Fitness is the right partner for the property, well suited to the shopping center’s co-tenants, and serves the surrounding community’s needs,” which, O’Connell adds is “a synergy we always aim to achieve.”

“Gyms are one of the few ‘big box’ retailers expanding,” says CBM President, Rick Rivera. “Considering a gym’s large footprint and the building’s position in the shopping center, another gym is perhaps the only suitable replacement tenant for this space,” Rivera notes. “Fortunately, Crunch understood the potential, and Dave O’Connell’s existing relationship with all the players paved the way for a successful transaction,” Rivera adds commenting on the fortuitous transaction.

For more information about CBM and their retail leasing and property management services, please contact: Rick Rivera 310.575.1517 x201 | rickr@cbm1.com.

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So, you’ve decided to hire a property manager…

That’s a VERY smart decision!

Whether you’re a busy professional who owns retail properties as an investment, a seasoned investor looking to scale back your involvement, or a beneficiary who has recently inherited a shopping center, the benefits of professional property management are many.

From specialized accounting to maintenance and property vendor oversight, to tenant relations management – hiring a property management firm takes a tremendous burden off your shoulders.

But before you make your selection, it’s important to carefully vet potential service providers. After all, you’re placing your faith in this third party, trusting they will take good care of your very valuable asset.

As such, it’s a good idea to meet, ideally, a face-to-face sit down, with prospective management firms and ask pointed questions to ensure you understand the breadth and depth of the services.

This exercise will educate you on how the firm operates. It also gives you an understanding why the firm has established its current methodologies. And it provides you with a clearer picture of exactly what you’re paying for.

Toward that end, here are 20 questions to ask when interviewing a prospective retail property management firm:

1. How long has your firm been in business?

This will give you a sense of the company’s stability. The longer a firm has been in business, the more consistent they’re likely to be in the long term. And given the effort involved in establishing management, it’s in your best interest to cultivate a long-running relationship.

2. How many properties do you manage?

This will demonstrate the size of the company. The more accounts the firm manages, the better established they’re likely to be.

3. How many property managers do you employ?

This figure, combined the number of accounts under management, answers several questions. First, a firm that’s handling many accounts, but only employs a few managers likely indicates your property will receive less attention.

Additionally, it’s important to confirm that if your property manager goes on vacation or otherwise takes leave, another manager will be available to step in and oversee your property during your manager’s absence.

4. Do you have a dedicated accounting department?

Thorough financial oversight is critical to effective property management. And a dedicated accounting department ensures close attention to detail, giving you the confidence your property’s financials are handled in a professional and timely manner.

5. What financial reports do you provide?

Monthly reporting lets you know what to expect in terms of month-to-month financials. It also helps keep abreast of your property’s financial position. And when it comes to year-end accounting, your CPA will need these reports to prepare your taxes.

6. When can I expect monthly financial reports?

This gives you an idea of the management company’s monthly cycle and lets you know when to expect updates.

7. Do you prepare an annual budget?

An annual budget serves a guidebook for your property. Planning things out in advance gives you a clearer picture of what to expect in the coming year. And enables you to budget according. It also helps establish CAM rates for the property.

8. Do monthly reports include a narrative review and photos of the property?

While tracking property financials is critical, keeping tabs on your property’s condition and tenant relations is equally as important. A narrative report with photos that documents potential maintenance issues and repair needs, in addition, logging tenant concerns ensures you’re up-to-date on all facets of your property.

9. How often do managers visit each property?

Site visitation a very important aspect of property management. When onsite, managers take note of maintenance and overall property condition, verifying vendors are fulfilling their duties and identifying any potential physical hazards. Visitation also impacts tenant relations, enabling the manager and tenants to develop a rapport.

10. Are properties under management divided up by area and size?

A management company may cover a wide geographical area. And some properties are bound to be larger than others. Ideally, you would prefer a manager who already handles other properties close to your location. And isn’t already overburdened overseeing too many other large properties.

11. How are after hours + weekend emergencies handled?

Many retail properties operate 7-days a week. And often clock 12+ hour days, if not even longer. If there’s an issue at your property that falls outside the Monday-thru-Friday, 9-5 workday, who is responsible? You want to be assured someone is “on-call” in case of an emergency.

12. Do managers review vendor contracts to ensure services are competitively priced?

Property vendor services can vary wildly in terms of price and quality. Your property manager should periodically bid vendor contracts to ensure both competitive pricing and quality service.

13. Can tenants pay rent + CAMs online?

With the growing popularity of ACH payments and the proliferation of online bill pay services, the demand election payment options for is rising. Not only is this approach more convenient and efficient, but rent + CAMs are also received in a timelier manner. Additionally, employing this technology indicates the management company is forward-thinking and striving to take advantage of the latest technology to streamline its business processes.

14. Can vendors submit invoices and be paid online?

Like online bill pay tools for rent and CAM, there are also services that automate vendor invoicing and payment dispersal. Typically, vendors submit paper invoices, the management company inputs those invoices into their property management software system, and then prepares and mails checks.

With an automated bill pay service, vendors electronically submit invoices that are automatically recorded into the management company’s financial database. Electronic payments are then sent directly vendors bank accounts, like ACH payments.

This eliminates postage costs, payments being lost in the mail, and avoids bank fees for lost check cancellations.

15. What services do you provide in addition to basic property management?

Retail properties have a variety of needs beyond just financial tracking, maintenance oversight, and tenant relations.

As a shopping center landlord, you may need assistance overseeing property upgrades, remodels, and tenant improvement projects; handling lease renewals; and lowering property tax assessments, among other things.

But not every firm offers these services. And some that do charge additional fees. It’s important to clarify the breadth of a management company’s services and the “added costs” costs (if any) involved. This knowledge gives you a basis to compare different management companies based on pricing and options.

16. Can you refer additional services, like property vendors, contractors, attorneys, etc?

Replacing under-performing or overpriced vendors, bringing in contractors to handle repairs or remodels, and hiring attorneys to defend lawsuits are all potential concerns for shopping center landlords. A management company that can not only refer these sort services but maintains strong relationships with such vendors is a boon to retail property landlords.

17. How do you charge for property management services?

Are fees based on a flat charge or a percentage of monthly gross rents? It’s important to understand how fees are calculated because vacancy may impact your monthly costs. If your tenants are on triple net leases, and you’re billing back tenants for management fees, will you be expected to make up the difference for a vacant unit?

18. How would you rate your level of customer service?

Whether dealing with tenants or vendors, respectful and attentive customer service is critical to fostering productive relationships. Tenants want to know their concerns are being heard and acknowledging their voice is crucial to keeping them happy and hopefully in place for long into the future. Treating vendors with respect is paramount to ensure they consistently deliver quality service.

19. How do you handle tenant disputes?

Tenants often complain about property conditions, the actions of other tenants, and CAM fees. Additionally, tenants frequently claim they can’t afford to pay their rent. In some cases, they’re facing a legitimate hardship. In others, their “financial hardship” claims are a ploy to secure a rent reduction. While it’s important to acknowledge tenant concerns, it’s also the management company’s duty to serve the landlord’s interests. Ultimately, you want a management company that exercises a firm, but fair hand.

20. Can I keep my current bank account?

For a variety of reasons, it may be advantageous for you to continue to use the bank through which your property financials are currently being processed. In some cases, the lender financing your property loan may require you to use their bank. Conversely, some management process property financials exclusively through their own preferred bank. If your property needs to remain with a specific bank, this important information to clarify upfront.

Interested in Meeting With CBM to Discuss Property Management For Your Retail Shopping Center?

Get in touch with Rick Rivera, CBM President, to schedule a meeting: 310.575.1517 Ext. 201 | rickr@cbm1.com


27625 Shangri-La Drive, Santa Clarita, CA

Centers Business Management (CBM) Valley Division Director, Dave O’Connell, recently completed a lease transaction representing the landlord in a deal with Hibiki Sushi, a local sushi restaurant on a 4,127 SQFT retail space. The unit is in a standalone building associated with a newer community shopping center at the signalized intersection of Shangri-La and Soledad Canyon in prime Santa Clarita. Stretching a full block along bustling Soledad Canyon, an active retail corridor, the sprawling center features a variety of A+ co-tenants, including T-Mobile, Domino’s Pizza, Crunch Gym, Centennial Bank, and more.


752 Harbor Boulevard, Santa Ana, CA

Centers Business Management (CBM) leasing agents, Aaron Guido and Daniel Barriga, recently completed a lease transaction representing the landlord and tenant, Charley’s Philly Steaks and Wings, a local restaurant, on a 1,235 SQFT retail space. The unit is in a corner shopping center comprised of four buildings and a drive-thru restaurant pad at the major signalized intersection of Harbor and McFadden in prime Santa Ana. Occupying a sprawling site, the center’s A+ co-tenants included Northgate Market, AutoZone, Boost Mobile, T-Mobile, Freeway Insurances, Little Caesars, KFC, and more.


11027 Alondra Avenue, Norwalk, CA

Centers Business Management (CBM) leasing agent, Jason Ehrenpreis, recently completed a lease transaction representing the landlord and tenant, a local ice cream shop, on a 3,600 SQFT retail space. The unit is in a corner strip center at the signalized intersection of Alondra Boulevard and Studebaker Road in prime Norwalk. In addition to the CVS anchor, the well-patronized center’s co-tenants include Universal Fitness Club, and El Marinero Mexican restaurant.


The 2019 ICSC Western Division Conference is officially in the history books…

For those who were able to stop by our booth, it was great to see you!

And for those we couldn’t make it, we hope to catch you next year :—)

That said, overall the event was a UUUUUUGE success.

The vibe was incredibly positive and the energy was very strong, making the event exceptionally productive for our leasing + property management team.

A New Location (On The Show Floor), A New Perspective

For over a decade, we’ve secured an end-cap island booth at the front of the convention hall. During the show’s tenure is San Diego, the spot positioned us directly in front of the convention hall’s main entrance. Arguably the best location in the entire show.

With the show’s relocation to Los Angeles three years ago, however, we’ve been pushed to hall’s far end, well away from the main entrance. Which, as you can likely imagine, is a less than ideal location.

So, this year we relocated to Retailer Central. This is the show floor’s main concourse, which bisects the entire hall. And, as the name implies, it’s where active retailers host their booths. From CVS to Dogtopia to Dollar General to Bliss Car Wash and many, many more our booth was in the thick of the show’s most hectic action.

Needless to say, the new location proved a huge boon to our exhibit, ushing in many more visitors than we’ve had in years. Which in turn revitalized our team’s interest in the event.

Refocused + Rejuvenated

This year’s show saw attendance drop from just over 4,000 attendees in 2018, to just under 2,500. And while it’s tempting to count declining attendance as a net loss, quite the opposite is true.

Rather than the aimless and distracted attendees of the past, this year’s participants were focused and motivated to get things done. And our team saw this determined concentration in action. Retailers, brokers, vendors, and even municipalities came with a definite agenda and channeled their efforts into achieving their goals with pronounced dedication.

Farewell to Los Angeles — ICSC Returns to San Diego

Though downtown Los Angeles is amid the full bloom of thriving gentrification, the venue has never proven an ideal spot for the ICSC Western Division Conference.

And this fact has led many members to complain bitterly every since the event relocated to Los Angeles from San Diego three years prior.

Fortunately, ICSC has taken note of member pleas and announced plans to return the event to San Diego in 2020. With the countless bars, restaurants, and hotels that inhabit San Deigo’s famed Gas Lamp district just steps from the San Diego Contention Center, it’s a far, far better locale.

And with all of this said…

We hope to see you next year in San Diego!

 


No one’s sure how many candles are on that cake, but let’s say no more than 29 ;—)

Regardless of the number, CBM’s Encino office wishes longtime property manager, Claudia Witt, a very happy birthday!

And we hope there are many more to come.

In the meantime, if you happen to bump into Claudia, give her your best birthday wishes, too.


Anaheim, CA – August 2019, Centers Business Management (CBM) completed a new leasing transaction with Southwestern National Bank in a mid-block strip center on Busy Ball Road in prime Anaheim

CBM leasing agent, Matt Saker, recently completed a lease transaction, representing the landlord in a deal with Southwestern National Bank. The Huston, Texas-based Southwestern National Bank will occupy a 4,900 SQFT space formerly inhabited by the Bank of California. Situated in a sizable, mid-block strip center, the property is home to a dozen prospering restaurant and service-oriented retail tenants. Located just east of the major signalized intersection at Beach Boulevard, the property straddles the borders between a thriving retail trade area and a densely populated residential community.

Founded in 1997 in Houston, Texas, Southwestern National Bank is a minority-owned business. Launched by a group of Asian Americans, Southwestern was established primarily to serve minority banking consumers. While the Anaheim site marks Southwestern’s first location outside of Texas – the bank currently boasts six retail outlets spread across the state – the flourishing financial services operation aims to open additional locations in the southwestern and northeastern regions of the United States.

A seamless transaction, the deal “came together easily,” thanks largely due to “Southeastern taking over a former Bank of California branch,” says CBM leasing agent, Matt Saker. “There’s a vault in place and the interior is already built-out to serve as a bank,” Saker notes. Saker also credits the roots of this deal to a broader shift in the banking world: “Many national retail banks just aren’t expanding,” creating a void that has opened opportunities for emerging banks, like Southwestern. “Well-established banks are relying more on online banking and other services, which in turn is reducing their retail presence,” Saker notes. This transition has seen a growing number of smaller, often regional banks expanding into prior national bank locations. Former bank sites can also be “repurposed and leased to a variety of other retail users,” Saker says, adding “and I’ve assisted a number of landlords with releasing these types of vacancies.”

“While retail is in a serious state of flux, it’s by no means disappearing. And this deal is a prime example!” says CBM President, Rick Rivera. “Space initially designed and constructed for a particular use isn’t obsolete if the original tenant vacates,” Rivera notes, adding “repurposing is an eternal mainstay of retail real estate.”

For more information about CBM and their retail leasing and property management services, please contact: Rick Rivera 310.575.1517 x201 | rickr@cbm1.com.

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The 2019 ICSC Western Division Conference — scheduled for September 16-18 — is less than a week away!

CBM is once again exhibiting at the convention. But this year, we’re changing things up a bit… Rather than our usual location, which has typically been facing the conventional hall doors, this year our island booth is fronting onto Retailer Row.

Over the past coupled of years, the convention’s concentration has shifted inward, focusing attention on the internal concourse that bisects the convention hall floor. AKA Retailer Row. And in an effort to capitalize on this increased activity, we’ve relocated our booth to this burgeoning new hot spot!

Planning To Attend The Convention?

By all means, drop by booth #1127 and say hi! The floor plan below shows exactly where you can find us (click on the image to enlarge).

CBM’s industry-leading retail leasing + property management team will be onsite to meet and greet all comers.

We hope to see you there!

[Click to Enlarge]


5334 Torrance Boulevard, Torrance, CA

Centers Business Management (CBM) leasing agent, Aaron Guido, recently completed a lease transaction representing the landlord and tenant, Rejuvenation Services, Inc, on a 2,240 SQFT office space. The unit is in a mid-block, 3-story office building on Torrance Boulevard, just west of Palos Verde Boulevard. Directly across from the building is a sprawling, newly constructed Providence Medical Center location stretching a full block along Torrance Boulevard.