It is no surprise that mixed-use developments are on the rise with 33% of the population wanting to live in a neighborhood that is walkable and offers all modern amenities. But there is an art to building one of these communities.
You can't simply build some buildings, and magically it will fill with commercial and residential tenants. If you are new to mixed-use development, then there are some factors you need to think about that are unique to this type of property development.
Follow these tips to ensure that your mixed-use project is a success.
1. Establish a Residential Identity
Commercial retailers look for specific population demographics when it comes to choosing a location for their stores. This can be a tough thing to show when your mixed-use place is in the build phase.
Clearly define the price points for the residential areas. You want to set the housing price point at a value that residents can reasonably afford.
You also want to keep in mind what people are willing to pay for. So the quality of the residential units will also help define who you will attract.
Once you have this, you can create a profile of the residents of the space. Use this profile to entice the right retailers to the space.
2. Choose Complementary Commercial Tenants
You do not want to accept any and all retailers that wish to take part. You need the right mix of retailers that will not compete and complement each other.
No retailer will be happy if they find out their direct competitor is also in the space. But you want to go further than this.
For example, if you have a real estate agent, insurance agent, and mortgage broker, try to group them together. These are all services that someone in the market to buy a home would need. They are also not services that someone would use daily.
You could put a nail shop, hair salon, and tanning location all near each other. These are all services that someone will use frequently and together.
When you group businesses in this fashion, they can aid in each other's success by sharing referrals.
3. Create a Co-Working Space
This is an added value for the businesses that you have in the mixed-use space. That way they have more flexible workspace available to them that they may not have otherwise.
These co-working spaces encourage networking and collaboration between everyone. You can also use this space to bring in additional income for you and potential customers for your commercial tenants.
4. Think About the Life of the Residents
If you load your mixed-use space up with commercial tenants that aren't beneficial for your residential tenants, you won't have an effective community.
Think about the commercial tenants that your residents want. They will want a gym or health club. A grocery store they can walk to will make life convenient and easy. Assets America has more ideas for these types of conveniences.
If you hope to attract families, then you'll want to include a playground or park and child care services. Otherwise, you could create a dog park and jogging trail.
A popular trend in newer mixed-use communities is to include a clubhouse or ballroom and "hotel rooms" that tenants can rent out. This provides a space for events and a nearby housing solution for when your tenants have visitors.
5. Create a Lifestyle for Your Tenants
Curate your mix of tenants that residents will view as desirable. Create a mix that will fill both needs and wants.
Needs would be services like banking, dry cleaning and laundry services, or a doctor's office. Wants include things like coffee shops, restaurants, bars, and entertainment centers.
Look for commercial tenants that will bring people together. This encourages people to gather and in turn, make your tenants more profitable.
6. Encourage Community Events
It is one thing to open a finished mixed-use development and have it full of residential and commercial tenants. It is another to ensure that your development has long term success.
One way to maintain long term success is to create a sense of community and loyalty. That way your residential tenants stay longer and have a positive feeling about the property and community as a whole.
To create these feelings, encourage regular community events. This could be an outdoor movie night, or weekend farmers markets, art festivals, or events put on by your commercial tenants.
7. Don't Forget the Outdoor Spaces
We briefly mentioned that you need to have an outdoor recreational space for your tenants. But this isn't the end of your outdoor space.
Create small gathering spaces throughout the community. This could be a few benches around a green patch. Or maybe a few tables and chairs on an outdoor patio for your restaurants.
If you have enough space, create an outdoor event space with a stage. This creates a venue for future gathering and event to continue to bring people there.
Consider encouraging the formation of youth groups or programs if your development is designed for families. If the elderly and retired are the target residents, then consider wellness or social clubs.
Make Your Mixed-Use Development a Success
The key to successful mixed-use development is thorough planning from the start. You want to ensure that you design the entire development from the beginning with the actual use in mind.
Be sure to build in outdoor areas around your buildings. Design your buildings to support complimentary businesses. Think about how your residential tenants will live and move throughout the development.
For the most success, keep in mind the things your commercial tenants look for when choosing a successful location for their next retail store.
