Small town main street tenants

[Matt Geerts]

TL;DR - Commercial newbie needs to know how to effectively lease up a few shops in a tiny town. 

I have found myself suddenly to be a commercial property owner. Besides some residential units, my new building has 3 commercial spaces. The building is a Main St. address on a great corner of a tiny rural town. A classic "small town Main St", exactly how you'd picture it. The three commercial spaces face the Main st and the entrances to the residential are off the side street.

I am not concerned with filling up the residential spaces. 

Can anybody recommend a strategy for leasing up the commercial spaces? Here is my strategy so far:

SWOT analysis

Strength - traffic traffic and more traffic:

1. Main st of a small town that is in between where people work and where people live. More cars pass through here each day than the population of the town, I think. 

2. The side street that I am on the corner of has the only liquor store in town a couple hundred yards up. 

3. I am located right between the Tim Hortons (coffee shop/Canadian icon) and the major grocers.

4. I am right next door to a national bank, one of only two in the town.

5. Across the street from the very busy clothing store.

Weakness - Small town, small population. 

1. The population is very small. The entire county is only 5300 people, so I'm guessing 2000 in this town. However, the county only has other small towns, so all of the farmers and people from other towns are used to travelling for shopping.

2. Low income town. 

Opportunity - There are definitely gaps in available stores/services

1. Aside from an abundance of pizza, lawyers, mortgages and insurance, there is no more than 1 of anything and 0 of many necessities. Examples include a sports store (in a hockey/baseball town), a gym, a deli and a dozen others. 

2. It sounds like every business that closes up shop in this town is not from failing, but rather from the owner retiring. This is leaving clear gaps.

3. I have a plan to discover the town's real needs - see below.

Threats - Not much

1. The very popular clothing store is closing after 100 years of business because the owners are retiring. They may sell the building vacant, but they have offered the potential buyer complete training in their suppliers and methods of running the shop so it may stay the same.

3. There is one other building with two storefronts that are vacant. This is not listed on MLS "for lease", the price is not aggressive and there is no apparent marketing effort besides a sign in the window.

So far my tactic has been to discover the town's needs. I have walked the main street and made a map of every business in the downtown and I will produce a cross reference of "business type" to identify what is over/under-served. I have also chatted with a few locals and another business owner. I am going to post a survey on the town's communal Facebook group to ask "When you go to another town to buy something, what are you going to buy?". I am also meeting with the Director of Economic Development, Mayor, Deputy Mayor and CAO of the town next week to discuss a "Resident Needs Survey" they recently completed for the county - hopefully it is town-specific. 

Once I have a list of the needs, I will glue my phone to my ear and call every single business owner in those categories within 50 miles and try to sell them on the idea of leasing my space.

As far as the building is concerned, 2 out of 3 com units are tenant-ready, 600sqft each. The larger unit is 1300-ish square feet and needs very minor fix-up (bathroom and a very minor leak in a 2-year old warrantied flat roof). The larger residential unit just needs a carpet clean, possibly a quick paint, possibly some new windows (would improve the look of the front of the building) and a new tile shower surround. The other units require from a little to a lot of work. I should be able to break-even on the building with any 2 of 7 units rented. It also has a detached 2-bay garage that I could rent out.

I have set myself a timeline of one month to find one commercial tenant, then I will turn over my efforts to a leasing agent who can show me a more aggressive plan than my own (hanging a sign in the window and posting on MLS is not an aggressive plan).

Let me know what you think of what I'm doing and PLEASE tell me where I can improve!

Thanks!