The retail real estate industry is a category within the commercial real estate sector. While the commercial sector encompasses properties, including buildings and land, that are used to generate profits the retail industry is more specific. Retail real estate consists of establishments that build and develop shopping and entertainment properties. Many people have found themselves in such a property as this category includes shopping malls, clothing shops, florists, and many more. The retail sector provides services that include renting, leasing, managing, buying and selling retail real estate.
While every investor has different needs Investors and property manager s working on the residential may find themselves dealing with lease renewals on an annual basis Retail real estate leases are typically longer at around 5 years.
When compared to other properties, the owners of retail space can find themselves in an advantageous position, they will typically pay for utilities, some maintenance, and other agreed upon expenses.
Istanbul’s two main shopping streets are now among the world’s 20 most expensive streets to rent retail space. Rental transactions on İstiklal and Nişantaşı avenues on Istanbul’s European side and Bağdat Avenue on its Asian side have been increasing over the last two years. There were 112 rental transactions in 2019 with another 139 in 2018, up from 109 in 2017 and 105 in 2016, the sixth edition of Cushman & Wakefield report on Istanbul’s top avenues.
In addition to all these factors, we must not forget the huge residential projects that have been built all over Istanbul and have been provided with shopping streets that provide the residents of these residential centers as well as the residents of the neighboring areas, a place for shopping and entertainment, in a way that saves them from moving to other places to spend their needs.
Rents for retail outlets in the streets of Bagdat Caddesi in Istanbul’s Asian side and Istiklal on the European side are together ranked 20th in a list ranking key shopping streets around the world in terms of rental value, compiled in a report by Cushman & Wakefield. And people in Istanbul still like visiting physical stores, and especially large specialist stores and local shops
This is encouraging news for investors in Istanbul’s property market, both commercial and domestic, as it demonstrates a growing demand for retail space, fueled by the Turkey’s increasing middle classes, an appetite for international brands and rising levels of wealthy foreign visitors.
How to categorize a retail Property?
One of the most important aspects of the industry is the actual
property
that allows tenants to operate their businesses and generate revenues. Retail
property
is not created equally. Some buildings are of a higher grade and have a higher demand than others. Generally, the
properties
can be broken down into the following classifications
Class A: The best of the best. Class A property is generally newer, in an excellent location, and has fewer maintenance issues. These properties typically command the highest rental rates.
Class B: These buildings are older than Class A and might be in a good, but not great, location. Investors who are interested in restoration projects are likely to seek out Class B properties.
Class C: The older properties that are in need of repairs and are not in the best location. Significant costs may be required to update electrical and plumbing systems.