New Retail Firm Advises Owners on Strategy

"We believe that owners now really need to focus on stabilizing their centers, and they need someone who can look at the whole picture," Crowley says. She cites her own career of specializing in optimizing the income-producing capabilities of retail centers and Boyce's experience in a wide variety of leadership positions in the retail and development sectors. Crowley is the former president of Urban Street Advisors and a former SVP and managing director of retail for CB Richard Ellis as well as president of Linda Crowley & Associates from 1989 until 1996; Boyce has held positions with Wherehouse Entertainment, Bristol Farms and Gelson's Market, as well as SVP positions with Hahn Devcorp and RP Realty Partners. In addition, she has served the site selection and lease negotiation needs for numerous prominent national retailers.

Crowley says that although many shopping center owners believe that all they have to do is wait patiently for the economy to recover, the reality is that "We've had an earthquake, not just a little blip." As a result, retail owners today need to be much more active, strategic and aggressive than they did when the economy was booming, she says.

To illustrate the kind of thinking that center operators need to adopt, Crowley cites a project she worked on during the last recession. Her analysis showed that 20% of the population in the center's trade area was Asian, yet the center had no businesses catering to Asians, so the Asian customers were leaving the city to do their shopping elsewhere. Crowley convinced the owner to bring an Asian market in as a tenant, and today half of the space in the center is occupied by Asian-oriented retailers and services.

Crowley says the example above illustrates that owners have to look at each property individually and figure out who the best tenants are for that specific center. "It's not always just the credit tenant," Crowley says. "You have to go out and find good retailers."

The first step in the process is stabilization. Owners need to analyze how each tenant is doing, what the chances are for their survival and what can be done to help them if sales are slipping. Landlords need to test the health of their tenants every month via sales reports, and if a tenant's reports show a decline, the owner needs to work with the tenant in an effort to boost sales through marketing, branding or other approaches, she says.

Once a center is stabilized, she and Boyce look for opportunities to bring in new tenants, Crowley says, a task that requires much more attention today than it did a few years ago. She explains that when the economy was booming, shopping center owners typically hired broker, posted a sign on their property and waited for tenants to call "You can't do that any more. You have to go after the tenants," she says.

Crowley, who has witnessed three major recessions during her career, says that there are always opportunities to reposition centers during such times and to get new, interesting retailers for owners who understand the realities of the market. She will be outlining those repositioning strategies when she and Judi Lapin of Lapin Consulting Group in Newport Beach co-chair a session titled "Rescue Efforts in Challenging Times," at the ICSC Spring Convention on Monday, May 18 in Las Vegas.

Focusing on those stabilization and repositioning strategies is of paramount importance to shopping center owners today because the retail landscape has changed so drastically and so quickly, according to Crowley. "A lot of people think it is just going to turn around, so they are willing to let a tenant go, figuring that they will just get another one," she says. But in today's world, she says, "If you lose a good retailer, it's going to be hard to replace them."