How do I check a store’s mall or plaza neighbours and anchor tenant risks?
Visit at different hours, note which neighbours draw people past your door, and ask the landlord who the anchors are and how long they are committed. Then read the lease for what happens to you if an anchor leaves. Your customers may be someone else’s customers first.
Spend time in the centre before you decide anything. Walk it on a weekday morning, a weekend afternoon and an evening. Count who goes where, without needing numbers, and notice which doors are busy. Which neighbours bring people to your storefront? Which are empty or look tired? Ask the shop owner how much of their traffic comes from the anchor, and what they saw when a past neighbour closed.
Then talk to the landlord or property manager. Ask who the anchors are, how long their arrangements run and whether any redevelopment is planned. Ask about parking, signage on shared pylons, hours the centre expects tenants to keep and common costs charged to tenants.
Read the lease with a particular eye for protection. Some leases give a tenant a right to leave or pay less if an anchor closes; many give nothing. Look for restrictions on who else may open nearby selling the same goods. Your lawyer should read these clauses, and you should record what the landlord told you in writing so promises do not rest on memory. Ask other tenants how the landlord behaves when problems arise.
Key takeaways
- Visit at several times of day and note which doors draw traffic.
- Ask the landlord who the anchors are and how long they are committed.
- Check what your lease says if an anchor leaves.
- Get the landlord’s answers in writing, not just by conversation.
Related reading
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Federal Economic Development Agency for Southern Ontario (FedDev Ontario)GovernmentUnderstanding your business lease
- 03Business Development Bank of CanadaGovernment13 terms you need to understand before signing your commercial real estate lease
- 04Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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