The symbiotic relationship between a landlord, a tenant, and a municipality is critical to the success of a retail property. More often than not in today’s environment, however, the challenges faced by one or more of these parties impacts the speed and efficiency of the deal.
As activity has increased in the retail sector, and demand is catching up with supply, there are some new ways of doing business that admittedly make things a lot harder.
Let me tell you a story. An established entertainment retail operator with 18 locations on the East Coast recently decided to bring their concept to the Chicago metropolitan area. We signed a lease with this tenant for a suburban power center – their first location in Illinois. They submitted their drawings to the municipality and received preliminary approval with a punch list of modifications to make. They implemented the changes and submitted plans again, only to receive a rejection with the notification that their architect was not actually licensed in the state of Illinois and a 40-page additional punch list. In this case, the village requirements make it difficult for the tenant to start work. Submit, come back, submit, come back. It’s a very painful process for tenants.