What would be your next step??

[Philip El-Aya]

I have recently acquired a small commercial property just east of Dallas, TX (Mesquite). It's a small property around 16,500 sq ft, but a very clean property that has a major road on both sides running parallel to it. My plan is to put a small shopping center on the property (give or take 4000 sq ft). I know in that area they charge around $20 per sq ft including NNN.

I am at the very beginning stages of trying to plan out how to approach this. Should I sit with an architect to start the design process then find tenants? Do I call a broker to help me find tenants now, or wait until I'm done with the architect? Basically I'm wondering what do you believe is the next step in this process? 

Interested to hear your thoughts,

Phil

[Nik Moushon]

Theres basically two mentalities for building strip malls: 

1 - Build it and they will come

2 - Built to suit

That really your two options. The first being just to build it and hope that there is enough draw to your location to get businesses attentions that they will come to you. Now a days this is not the smartest....this was pre 2008 mind set.

The second is the more common choice for several reasons. One being that you and the architect can sit down and design the space for a specific business (renter). Two, banks will be more willing to lend if you have a tenant contract in-place already. Three, its much easier, and cheaper, to build out your spaces when you are building the building. Instead of having to come back months later and bid out a tenant improvement build. 

As for contact an architect, yes, thats a must. You will need one on board anyways for permits. Do some research and pick a local architect and start the site analysis part of the project. This will take a couple weeks for them to do. In the mean time meet with a broker to start marketing and finding tenants. The sooner you get one on contract the better. hopefully by the time the architect is in design phase (preferably before permits are submitted) you will have at least one tenant.