COVID’s Lasting Effect on Retail Leasing

November 7, 2022 • Earlier this fall, I virtually sat down with Margarita Foster at LoopNet to discuss how Covid is continuing to impact the retail real estate market. The resulting article An Expert Look at COVID’s Lasting Effect on Retail Leasing summarizes The Sinreich Group’s experience during and after Covid. We negotiated dozens of Covid lease amendments and over 20 new leases with all sorts of tenants in locations throughout the country between March 2020 and June 2022.

As noted in the article, retail real estate markets have recovered from the darkest days of Covid when retailers regularly obtained un-heard-of concessions that essentially gave them the flexibility they’ve always craved. Rent streams were based on sales, early termination rights could be exercised if things were not going well, and large tenant improvement allowances meant that landlords were shouldering most of the risk that the lease might not work out long-term.

Fast forward to today and percentage rent is a much smaller component of overall rent streams, early termination rights are less prevalent, and landlords are thinking hard before agreeing to large tenant improvement allowances that they might not be able to recoup.

What has lingered is a tenant-friendly market where Covid-era concessions are the subject of negotiation rather than dismissed as a pipe dream.

Take a look at the link below to learn more and let us know what you’re seeing in the retail real estate market.