Here’s the scenario: you have a great business, but it’s difficult to get to. Perhaps you have a great business that is easy to locate, but there is no parking. Or, your business is located outside of a bustling business district. Any or all of these factors can sink, or limit, an otherwise quality business. Conversely, having a well located business can help overcome competitive challenges. This is precisely why we, at Eidi Properties, focus on location for all of our commercial properties. By location, we mean where the space is located as well as what the location offers, e.g. parking, facilities, ease of access, and aesthetics. Location, therefore, adds value and improves the probability of merchant success.
Eidi Properties founder and CEO Ramy Eidi explains it like this: “Location is crucial because convenience and easy access are what can make or break retailers. If access is easy and parking is accessible, and being located next to other tenants that can drive traffic, retailers can have a built-in customer base just based on that.”
It is difficult to overestimate the value of having a thriving business neighborhood. When someone drives to a neighboring drycleaners to drop off clothes, they might pop into the store next door for a quick drink or remember they needed to buy something they’ve been forgetting. The ease and convenience of the store next to their activity almost assures a sale that they might have otherwise made elsewhere. Every successful store creates traffic and clientele to their neighbors and the cycle repeats itself. In the real estate industry we refer to this as “Tenant synergy,” where each business, either directly or indirectly, feeds off the other Tenants within a shopping center. Synergy is key to any business location decision.
Although we work hard to provide a bustling business neighborhood in order to drive traffic to our shopping centers, it is also essential that the location is well placed among other businesses. A key factor is to be where people frequent. This places the stores in an area where other businesses and attractions help draw in customers. The more trafficked an area is, the more likely the surrounding businesses will be visited.
The location has an additional benefit to our tenants: reduced costs. One typical expense in business is advertising. Businesses spend large amounts of money to get the word out that they exists and where they are. When your store is surrounded by huge throngs of people on a daily basis, it achieves direct and effective advertising as well as customer traffic. Spending less on advertising and marketing, allows businesses to invest more into their operations and growth.
A good location also reduces the shared costs of utilities and services like waste disposal, cleaning services and maintenance providers. Due to the fact that the tenants have the option to share these expenses, connecting to a location with fellow merchants reduces the expenses of having a stand-alone store. In business, every penny counts, and these advantages can help widen profit margins and keep your business in the black.
Finally, having a quality location creates competition and sparks the desire to outdo the neighboring businesses. This fosters innovation, better customer prices and better service and selection. These conditions, created by competition, attract people to the commercial area and develop a culture where customers feel comfortable and confident shopping.
Location is critical to the success of our commercial properties. It provides customers with easy access to the goods and services they seek. When your business is well situated and designed for customer convenience, people automatically populate the area. We consider these factors extensively when we acquire a commercial real estate. A shopping center’s placement, along with ingress and egress, are critical factors to help us determine the viability of a location. These conditions are vital to ensuring a quality business environment, where merchants can succeed. And as we continuously say, their success is our success.