REITs Support Small Business Tenants Through Video, Leasing, Mentorship Initiatives

May is Small Business Month and a time to celebrate the efforts and accomplishments of an important segment of the nation’s economy.

Small businesses employ nearly half of the nation’s entire workforce and represent 43.5% of GDP, according to the Small Business Data Center at the U.S. Chamber of Commerce. Yet small businesses and local entrepreneurs face a range of challenges to establish and maintain a successful operation—a fact that retail REITs are not only aware of but are actively working to address.

Read on to see three examples of how REITs are helping small businesses and entrepreneurs thrive, whether through showcasing their local talent, easing the leasing process, or providing valuable mentoring and learning opportunities.

Regency Leans into Video to Highlight Local Merchants

Small businesses are a major part of Regency Centers Corporation’s (Nasdaq: REG) national portfolio and creating visibility into what they offer to customers and the community through the use of video is an important and evolving element of the REIT’s strategy.

Eric Davidson, senior communications manager at Regency, says the original impetus to showcase the REIT’s local talent came during the pandemic when the ‘Regency Loves Local’ campaign was created to highlight “best-in-class local merchandising that make Regency centers staples of their surrounding communities.” He notes that Regency was looking for ways to provide assistance or extra opportunities to create touch points between merchants and their customers during that challenging time.

Regency decided to modify and scale the Regency Loves Local campaign and subsequently introduced its ‘Local Flair’ video series. For its pilot launch, Regency turned to local operator Treylor Park, a restaurant/bar located at Nocatee Town Center in Ponte Vedra Beach, Florida. In the video, co-owner Rick Kunzi shares one of Treylor Park’s favorite drink recipes, known as The Wicked Kiwi.

Regency has also showcased Glacier Ice Cream, a family run “passion project” located at the Belleview Square center in Greenwood Village, Colorado. In the video, owner Sarah Bock demonstrates how to make its popular salted caramel ice cream sandwich.

Davidson says feedback to the video series has been positive, and more videos are in the pipeline. “We allow local merchants to showcase what they do, why it’s unique, all while letting their personalities shine through. The focus isn’t on Regency but rather these amazing operators that we’ve been fortunate enough to house at our locations.”

He goes on to explain that their current video strategy brings the power of the local merchants into the narratives that are more focused on the properties, as well as their advertising. “The properties are great locations, but a location doesn’t attract a shopper by itself. Merchants do, and the full story of our locations can’t be told without them.”

Recently, Regency received a Silver MAXI Award at ICSC Vegas 2024 for its video efforts. Titled “The Abbot: The Unofficial Gateway of Harvard Square,” the piece is a look at a historic redevelopment that gives a large spotlight to the amenities and offerings of the merchandising mix.

Davidson notes that Regency is leaning into video not only to showcase the local talent already in its centers, but to attract the best new local concepts that might not be familiar with Regency.  With over 20 regional offices, the REIT has clear insight into local operators and power players, Davidson says, and has a long track record of introducing store concepts that are well-received in the local community.

Macerich Tech Platform Works to Ease Local Entrepreneur Leasing

Macerich (NYSE: MAC) believes that making the leasing process as simple as possible for its small local entrepreneurs is key to having a strong and diverse mix of tenants across its portfolio. To that end, Macerich has partnered with real estate industry software developer Yardi, utilizing its property data and listings platform CommercialEdge, to power its QuikSpace online leasing platform.

Ken Volk, executive vice president for business development at Macerich, says that prior to the pandemic the REIT had worked with several other companies to list space within its malls on third party sites, but felt that the properties were not well-represented and the process was cumbersome for small business owners.

Launched in 2021, Quikspace has digitalized the leasing process from generating a lead right through to execution, Volk says. Knowing that many local entrepreneurs look at space outside of regular business hours, Quikspace is designed to mimic how one books a hotel room or storage space today. It allows potential tenants to locate a mall, find a space, do a virtual tour, fill in an application, and generate a lease. Before signing the lease, Macerich speaks to the retailer to ensure everything is a good fit. “It becomes so seamless; we are really taking the administrative burden out of the entire process for the retailer, and our own internal staff,” Volk says.

Volk describes the technology as a “pretty stunning advancement” for the retail real estate sector, which he says has traditionally lagged other segments of the commercial real estate industry.

In addition to showing leasing opportunity for common area and temporary in-line stores, potential tenants now also have the ability to use the platform to view available storage space at various Macerich properties. Importantly, tenants can renew their storage agreement or their retail agreement via the tenant portal, as well as pay rent and submit sales information. “We’re doing everything we can to take the friction out of short-term leasing, which is primarily for a local entrepreneur,” Volk says.

Macerich currently has about 850 temporary, in-line tenants, as well as many more local entrepreneurs that own national franchises as permanent tenants.

QuikSpace is currently in use across the entire Macerich portfolio, including providing pricing for storage spaces. As well, Macerich is piloting fixed temporary rents on vacant spaces at two properties, just like one would see on a hotel, vacation rental or storage company website. Volk notes that since launching QuikSpace at Wilton Mall in Saratoga Springs, New York, Macerich has secured seven new local tenants for one-year leases. Macerich also has secured multiple leases with local businesses for its Superstition Springs Center in Arizona.

“Local entrepreneurs and businesses are important to Macerich and I think this platform works for the retailer and for Macerich. In many cases the temporary lease is at favorable rent and we’re helping the tenant evolve their business to see if they could become permanent,” Volk says.

Phillips Edison Investing in Success of Local ‘Neighbors’

Phillips Edison & Company, Inc. (Nasdaq: PECO) refers to its tenants as “neighbors,” and with more than 2,500 local neighbors located across PECO’s portfolio of 274 neighborhood shopping centers, they can be a real differentiator for its properties, says PECO COO Joe Schlosser.

Schlosser says that last year, PECO’s Associate Vice President, Customer Experience, Katelyn Wloszek alerted him to the opportunity of helping PECO’s local neighbors through a sponsorship partnership with The SCORE Foundation. SCORE provides a free 10,000-plus nationwide mentor network and education programs for entrepreneurs and small business owners. Schlosser was eager for PECO to offer the service, and the partnership was launched in September 2023.

“Many of our neighbors are locally owned small businesses, and we are constantly looking for ways to help invest in their success and provide resources to help them thrive,” Wloszek says. Schlosser adds that PECO even had a situation where one of its local neighbors applied and was matched with a mentor who was nearby and was able to visit in-person. “There's a real personal touch,” he says.

Response to the partnership has been positive in the months since it launched, with more than 35 local neighbors applying for a mentor match. Schlosser says that one local neighbor said they valued the services provided by their individual mentor at around $5,000 to $10,000, making it a resource for small tenants that has meaningful value.