A health ratio is a good indicator of the livelihood and longevity of a retailer by viewing their annual sales against their annual rent. Read more by Claudia Bordeaux and Dan McPhillips below.
July 2019, Raleigh-Durham
Commercial real estate sectors all have their own needs, desires, and expectations. Office tenants look to create appealing spaces that will attract the clients and employees they desire in typical central business districts often among their competitors across the street or in the same building. Industrial tenants tend to be located along thoroughfares that make logistical sense for their area in business in buildings that generally work for their use. Medical needs to be conveniently located to the homes and the demographics they look to service.
Retail tends to be a little more complicated in their site location and cover all the requirements from office, industrial, medical, and then some. Retail tenants need to be well-located, visible, easily accessible, appealing to the public, close to their desired demographic, situated along their logistical distribution routes, be well-branded, work within other retailer restrictions, exclusives, and competitors, all while maintaining a product line or service that the general public desires or needs.
In the ever-changing world of trends, fads, diets, and increasing rental rates, it's of utmost importance now, more than ever, for retailers to mind their projected sales and health ratio. [...]
Learn more about Colliers International Raleigh-Durham Retail Advisory Team.