CBM’s Retail Shopping Center Management & Leasing Blog

Retail Real Estate News & Trends in Southern California
 

From the youngest to oldest, three veteran CBM team members both celebrated recent birthdays.

David Levcovitch, long-time Encino-based leasing specialist, is well into his 7th decade here on planet Earth. Meanwhile, Jeff Lerner, CBM’s IT manager, has good 40+ years of ground to cover if he ever hopes to catch up with David. And somewhere in between is Ms. Tina Flor, property manager extraordinaire (and that’s all we can reveal about her exact age ;—)

Regardless of their age gap, this fabulous trio came together and celebrated their birthdays with CBM’s entire Encino office. And we have the pix to prove it!

Congrats and happy birthday to David, Tina + Jeff — here’s to many, many more!

[Check out the happening on video here!]


12500 Magnolia Boulevard, Valley Village, CA

Centers Business Management (CBM) Valley Division Director, Dave O’Connell, and leasing agent, David Guardado, recently completed a lease transaction representing the landlord and tenant, a local Asian restaurant, on a 2,535 SQFT retail space. The unit is in a street retail property at the intersection of Magnolia and Whitsett in prime Valley Village. Neighboring tenants also situated on the intersection include Rite Aid Pharmacy and a Pizza Hut / Wing Street drive-thru restaurant.


11230 Garvey Avenue, El Monte, CA

Centers Business Management (CBM) Valley Division Director, Dave O’Connell, recently completed a lease transaction representing the landlord and tenant, a local dental clinic, on a 1,200 SQFT space. The unit is in a sizable, corner retail strip center is at the signalized intersection of Garvey and Peck in prime El Monte. The center features a diverse mix of restaurant and service tenants, including Boost Mobile, and is situated across from a busy 76 Gas Station.


945 W. Pacific Coast Hwy, Wilmington, CA

Centers Business Management (CBM) leasing agent, Jason Ehrenpreis, recently completed a lease transaction representing the landlord and tenant, a local coin laundry operator, on a 2,030 SQFT retail space. The unit is in 7-Eleven anchored strip center at the intersection of Pacific Coast Hwy and Wilmington Boulevard in prime Wilmington. In addition to 7-Eleven, Cricket Wireless also occupies the center. Neighboring tenants also situated on the intersection include a Jack-In-The-Box drive-thru restaurant, an Arco/AmPm gas station + convenience store combination, and an Express gas station.


2944 Cark Drive, Long Beach, CA

Centers Business Management (CBM) leasing agents, Geoff Grossman + Aaron Guido, recently completed a lease transaction representing the landlord and tenant, a local brewery, on a 1,075 SQFT retail space. The unit is an add-on to the 1,248 SQFT space the brewery leased in January of this year. A mid-block strip center, the property is situated on busy Clark Avenue, just east of Spring Street, across from a massive office park that stretches several blocks along Clark Avenue.


1341 E. Cason Street, Long Beach, CA

Centers Business Management (CBM) leasing agent, David Levcovitch, recently completed a lease transaction representing the landlord and tenant, Metro PCS (cell phone sales + service), on 1,200 SQFT retail space. The unit is situated in a mid-block strip center on Carson Street, just west of the signalized intersection at Vera Street in prime Long Beach. Boasting a diverse mix of restaurant and services tenants, the site is positioned in between the K-12 Bethel Baptist Christian School and an EconoLodge motel.


6414 Del Amo Boulevard, Lakewood, CA

Centers Business Management (CBM) leasing agent, Aaron Guido, recently completed a lease transaction representing the landlord in a deal with a dental clinic on a 1,200 SQFT space. The unit is situated in a busy retail strip center is at the intersection of Del Amo and Palo Verde in prime Lakewood. Well-maintained and professionally managed, the recently remodeled center features a diverse tenant mix, including Subway, an optometry clinic, insurance office, pet grooming, escrow company, nail salon, and massage medi-spa. The property is surrounded by a dense, thriving residential neighborhood, which generates a consistent stream of consumer traffic.


The San Fernando Business Journal recently ranked CBM among the 20 top producing retail leasing brokerages in the San Fernando Valley region. To gain further insight into the Valley’s evolving retail landscape, SFBJ staff reporter Michael Asuhenke reached out to Dave O’Connell, CBM’s Valley Division Director, for his perspective on retail real estate in the Valley.

“The Village [Westfield’s Food Hall on Topanga Cayon Boulevard in Canoga Park] has been a transitional project for the San Fernando Valley and has made retail an experience,” O’Connell notes, adding “High-end retail with the right project can really do well in the Valley.”

Mr. O’Connell also underscored how traditional retail strip centers are still thriving, especially in grocery-anchored centers, pointing to recent deals he completed with Western Dental and El Pollo Loco in grocery-anchored properties. Additionally, O’Connell noted restaurants remain in high demand, and outlying areas, such as Santa Clarita and Lancaster, with retail centers that have languished with empty units for years, are seeing vacancy rates drop steadily.

Read the complete article here.


Another ICSC Western Division Conference is in the books!

As always, CBM’s industry-leading retail shopping center leasing + property management team was on hand, meeting with clients and tenants, making contacts with relevant vendors and municipality representatives, and generally taking advantage of the best commercial real estate networking Southern California has to offer.

3,900 Attendees + 237 Exhibitors

Though the show felt slower in than past years, there were over 3,900 attendees registered, and 237 exhibitors hosting booths. These attendees and exhibitors represented a diverse group of commercial real estate professionals, including brokerages, tenants, developers, vendors, and municipalities, all uniting to network, cultivate relationships, and make deals!

The Show Floor’s Tenant Runway Attracted Plenty of Attention

Ever since ICSC introduced the Tenant Runway section to the show floor a few years back, it has become the convention’s busiest locale. And this year was no exception. Countless brokers were relentlessly courting retailers, hawking their wares in a concerted effort to make deals happen.

And Most Importantly For Our Team… DEALS GOT DONE!

Over the years, ICSC has consistently proven to be an excellent deal-making setting. It’s the perfect opportunity to bring landlords and prospective tenants together on neutral ground and hammer out the details underlying potential transactions. And as is the case at nearly every ICSC convention, our leasing team made several big deals happen this year, too!

Another Successful Show

All-in-all, we’re chalking up this year’s ICSC Western Division Conference as a definite success. And if we didn’t connect with you at the show, we hope to catch up with you very soon!


So far in our continuing series addressing Frequently Asked Property Management Questions, we’ve covered:

How Much Does Property Management Cost?

What Services Does Property Management Include?

How Often Will a Manager Visit My Property?

And Can I keep My Bank Account?

The next installment?

What Do I Do If a Tenant Consistently Pays Late or Doesn’t Pay Rent At All?

Another excellent question! And an issue that far too many retail landlords struggle with. But as common as this matter may be, it’s one of the more complicated problems to solve. More often than not, there isn’t one “ideal resolution.” The best course of action generally varies and depends on several key factors…

The Quality of the Tenant

Is this a tenant that’s typically reliable but happens to pay rent late on occasion?

Is this a tenant that pays rent, but consistently pays late?

Is this a tenant that pays late and is few months delinquent?

Or is this a tenant that has ceased to pay rent and is months behind?

The Frequency of Late Payments

Every month?

Every couple of months?

Once or twice a year?

The Amount of Outstanding Rent Owed

How much back rent is owned…

A couple of months?

More than six months?

Over a year?

The Difficulty to Re-Leasing a Vacancy

If a tenant vacates, of their own accord or is evicted, how difficult will it be to release the space?

How Do These Factors Impact Your Decision-Making Process?

It really boils down to how you chose to address different tenant types…

A Quality Tenant with Rare or Occasional Late Payments

This is a tenant well worth keeping and worth keeping happy. Thus, charging a late fee is likely not in your best interest.

A Consistently Late Paying Tenant

This tenant definitely deserves to be charged and late fee. And late fees should be leveled until the tenant gets the message and pays their rent in a timely manner.

A Delinquent Tenant

Continually charging late fees is only adding to their balance, making it that much tougher to bring their account current, and pushing than that much closer to breaking their lease and vacating the space. This scenario comes down to whether or not you really want to keep the tenant. Either you organize a payment plan and offer incentives to help the tenant bring their account current. Or you take steps to evict the tenant.

A Tenant Occupying a Difficult to Lease Space

A tenant that consistent pays late or is delinquent but occupies a difficult to lease space may be worth keeping. In this scenario, it’s a matter of weighing the potential revenue the tenant’s occupancy implies verses being saddled with a space you’re unable to lease for years to come.

As you can see, there are several important factors to weigh in deciding how to deal with late, delinquent or non-paying tenants.

But regardless of the circumstances, there are tactics you can employ to ensure tenants (generally) pay rent on time.

Strategies to Avoid Late Rent Payment

The most effective method to avoid chronic late rent payments? Employing: “The Carrot and the Stick.”

In other words, rewards for “good behavior” (the Carrot), and punishment for “bad behavior” (the Stick).

But let’s flip the script and start with the Stick, as “bad behavior” is what generally brings this situation to a head.

The Stick… This can take the form of both threats and actual punitive measures.

Late Fees

Late fees are typically written into lease agreements. But such fees are exercised at your discretion. Thus, if a tenant is late once or twice, you can threaten to charge a late fee. If a tenant is late on multiple occasions, you can exercise your right under the lease and charge a late fee. And you can continue to charge late fees if a tenant’s late payments persist.

3-Day Notice to Pay or Quit

Here again, you can threaten to post a notice. And if this fails to impress your point upon a tenant, you can make good on your threat and actually post a notice to prove you’re serious.

Eviction

To clarify, an eviction is a long, complicated, and difficult to navigate process that generally favors the tenants. One misstep in procedure or paperwork can completely foil your efforts and force you to start the entire process over again, from the very beginning.

As such, an eviction this should always be your last course of action. But both the threat and the exercise of an eviction action (at least initiating the process, but not necessarily carrying it through) can be a strong motivating factor that renders many tenants “scared straight.”

The Carrot… On the other side of the coin, you have incentives to motivate tenants to pay rent in a timely manner and keep their account current on a consistent basis.

Managing Late Rent

Let’s say a tenant has consistently paid rent late for 12 months. If that tenant can pay rent on time for 12 consecutive months, they will receive a 20% discount on their rent in the 13th month.

Or let’s say a tenant has consistently paid rent late for 6 months. If they can pay rent on time for 6 consecutive months, they will receive a refund of all late fees collected during the six months their payments were lagging.

Managing Delinquencies

Let’s say a tenant owes several months of back rent. If they are able to consistently pay rent on time for 12 months, a portion of the back rent will be forgiven on the 13th month.

Or let’s say a tenant owes a great deal of back rent. If they are able to consistently pay rent on time for 12 months, the landlord will agree to a payment plan in which the tenant can pay down the back rent without incurring any interest fees or additional charges.

These are just a few examples… There are a number of possible incentive programs to help keep tenants on track and up-to-date on their monthly rental payments.

Need Help Dealing with Late + Delinquent Tenants?

One of the key services professional property management provides is Tenant Relations Management. We’ll step in and deal directly with your tenants, taking the burden of frustration and stress off your shoulders.

And we’ll work with you to assess a given tenant’s situation, and make recommendations on when to take punitive action (administer the “stick”) and when to offer incentives (dangle the “carrot”).

For More Information on Professional Property Management Services

Visit our Services page at: cbm1.com/services