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The 5 Types Of Landlords Businesses Will Encounter

Here are the five types of landlord, and how you should deal with each of them.

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Securing a commercial lease — office, retail or industrial space — is a complicated process that requires much time and effort. As a business owner, there are several different types of property owners you may encounter in your initial search and even during your occupancy, ranging from small individual owners to multi-rand dollar real estate investment trusts.

Working efficiently with each kind of owner requires a basic understanding of their preferences and priorities.

Related: Choosing a Retail Location: 3 Priorities You Might Be Forgetting

Here are the few key characteristics of each group:

1Mom and Pops

Mom and pops are owners with smaller portfolios who obtained property as a primary investment. They are not as formal in business practices as other types of owners. Often personally vested in their space, they favour tenants who will treat their space well.

Characteristics

  • Usually straightforward and easy to deal with
  • Great for those who desire a close landlord/tenant relationship
  • May be flexible on terms for the right tenant
  • Best fit for smaller businesses with simple needs.

Tips

  • Communicate with a personable and warm manner
  • Highlight what makes you a good tenant
  • Convey your willingness to take ownership of the space
  • Share creative ideas on how your business can indirectly benefit them.

2Family investors

Unlike Mom and Pops, family investors are ‘real estate families’ who have amassed a sizable portfolio over tens or even hundreds of years. The tenant/owner relationship may not be as intimate but nonetheless, family owners are still materially involved in the leasing and management of their properties.

Characteristics

  • Still operate with a personal touch and often handle leasing in-house
  • Generally cash flow driven; prefer stable tenants over the highest possible rent
  • Have intimate knowledge of every building in their portfolio
  • Tend to have long-term tenants that they have accommodated over many lease periods
  • Best fit for small to mid-size businesses who are looking for a landlord that is willing to build space and accommodate their short-term growth needs.

Tips

  • Check out other buildings within their portfolio to get a better sense of what they have to offer
  • Be warm and personable because it’s not only the bottom line that drives these owners
  • Clearly communicate your needs and limitations; they will do the best they can to accommodate
  • Be prepared to put down a significant security deposit if you don’t have strong financials.

Related: Location, Location, Location!

3Management companies

rent-management-companies

While technically not an owner, management companies act on behalf of the owners that hire them. For the purposes of leasing and day-to-day property management, they are the de facto owners. Management companies typically have access to a large portfolio of properties with a variety of options to fit any business needs.

Characteristics

  • Very knowledgeable and can accommodate a wide range of needs
  • Allocated budgets for building improvements and capex
  • Offer standardised and less flexible lease terms, especially for smaller tenants
  • Best fit for businesses that have established credit, as these owners often have specific requirements and operating rules.

Tips

  • Expect to sign a five-year lease
  • If you are a high profile tenant who’s well recognised or generating a lot of buzz, use this to your advantage, as these landlords like having notable tenants in their roster.

4Real estate developers

As the name suggests, real estate developers develop and acquire office, residential, hotel, retail and mixed-use properties. The properties they construct are typically Class A buildings designed by award winning architectural firms and feature some of the best amenities offered by any landlord.

Characteristics

  • Extremely well maintained common areas and large lobbies with strong security
  • Looking to capitalise on the quality of their buildings and generate the highest rents in order to maximise property value
  • Often limited to major markets/cities
  • Usually more than willing to build space for long-term tenants or provide a significant tenant improvement allowance
  • Best fit for companies looking for premium space.

Tips

  • Plan well in advance as deals can take a long time to close
  • Ask for specific details and changes to the space that will help your business
  • Use time as a negotiating factor; many new buildings need to secure tenants even before new buildings are completed.

Related: Choosing the Right Location

5Institutional investors

Institutional investors are money managers who invest in various asset classes, including commercial real estate. Of these investors, real estate investment trusts invest solely in real estate properties but most funds will also invest in properly as part of a diversified portfolio.

Characteristics

  • Most assets are Class B+ to Class A buildings that generate strong cash flows for investors
  • Driven by occupancy rates and margins, not personal preference.

Tips

You are unlikely to deal directly with these owners unless there’s a major dispute, you’re an anchor tenant and/or a large tenant improvement (TI) allowance is involved. If you do, make sure you sweat the details. These are not your typical landlords, so make sure all of the right paperwork and documentation is in order.

This article was originally posted here on Entrepreneur.com.

Justin Lee is the COO and co-founder of TheSquareFoot, a technology-fueled commercial real-estate brokerage and listings platform that modernizes the search for office and retail space. Lee began his career in commercial real estate as a leasing representative for Boxer Property and has overseen hundreds of leasing transactions over the course of his career. He also served as project manager at Oakmont Group, a diversified Houston Real Estate development firm.

Company Posts

With Hundreds Of Franchise Options Out There, Choose The One You Can Trust

If you’re looking to invest in a business venture that offers you years of experience in the industry, the trust and loyalty of its customers, and franchise support from an expert team – then Hi-Q is the one for you.

HI-Q

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What you’ll become a part of

Since opening their doors in 1999, Hi-Q has gone from strength to strength, growing a humble three store enterprise into an extensive 130-store franchise network with a unique multi-product and multi-services automotive offering.

Hi-Q’s approach to business is centred around being ‘the one you can trust’ to their customers, their suppliers and their franchisees.

“That has always been the key driver in everything we do,” says Sean Harrison, Hi-Q’s Managing Director. “For example, when it comes to our customers, they need to know they can rely on us to put their safety first.

Related: Don’t Tread On Toes – Why Investing In A HIQ Franchise Will Offer You More Opportunities

That we’ll always strive to offer them expert, friendly service and top of the range products, while also keeping up-to-date with the latest technologies and advancements in our field.”

An acclaimed and awarded brand

Hi-Q has again and again proven themselves to be a leader in the industry.

They’ve been voted South Africa’s No.1 tyre retailer for eight consecutive years (2010 – 2017) by consumers in the Ask Africa Icon Brands Survey, the biggest of its kind in Africa – a clear indication that they are respected and trusted by their customers.

Business support

Hi-Q Franchisees all have the support of an expert and knowledgeable team with years of experience in the industry, who are available to guide them on their business venture. This includes areas of business such as marketing/promotional, commercial, organisational structure, tools and equipment, sales and more.

Franchisees also have access to various skills training opportunities for members of their team.
Hi-Q is invested in providing their network with the tools needed to thrive and grow in an ever-challenging market.

Relationship with Goodyear

Hi-Q has the support and backing of international tyre of multinational premium tyre manufacturer, Goodyear, and its full value proposition. This means access to incredible promotional and marketing opportunities in partnership with the brand.

Franchising opportunities

Hi-Q has embarked on an extensive expansion plan and have identified areas of opportunity to extend their Franchise footprint growth countrywide.

You’ll find more information on our website www.hiq.co.za We’d like to invite those who are interested to become part of our team to contact 011 663 2431 or bernie_andrews@goodyear.co.za

Related: We Want To Invite You To Join Us On The Hi-Q Journey And Become A Franchisee

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Researching a Franchise

The Digital Headaches Of A Franchise Marketing Team

Here are my top 5 tools that can help control and regulate franchisees marketing with minimum friction.

JG Bezuidenhout

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Franchise marketing teams already know that managing campaigns for a business with multiple locations and/or stores is a time-consuming job.

When it comes to online marketing, many franchisees are frustrated with the mother brands’ national campaign strategy, as it may not suit their immediate needs. This often means they embark down the dangerous route of “rogue” or unapproved campaigns.

This is a huge risk for any brand as there is limited to no control over the message and quality of creative, often resulting in brand CI and best practices not being followed.

Rogue advertising can be totally avoided by a franchises’ marketing team by employing tools that allow them to set up a managed process where franchisees can advertise through. With a managed approval process (preferably automated) it is easier to manage “rouge” content.

Here are my top 5 tools that can help control and regulate franchisees marketing with minimum friction.

1. Create a consistent Facebook content experience whilst still allowing your franchisees to post to their own page

Facebook location pages makes it possible to, as an alternative, allow every store to open a Facebook page, each with different versions of your logo as their profile picture, as well as incomplete profile data or even old or past promotions as their cover image. You as a brand manager can set up each store as a location page on the brand’s main FB page.

The pages can all be linked to the main page and if you change the profile image or cover art, it will automatically update all the other pages. There are also a number of other marketing advantages to this, but most importantly for me was the ability to manage them all from a single interface and clean up all the old and abandoned pages that just confused customers.

2. Manage social media content

Gain is extremely simple to use and connected to all the popular social media platforms such as Facebook, Twitter, LinkedIn etc. As a user, you can create posts or ads and schedule them all from the same window. Once said posts are scheduled, the marketing team can preview the content and approve it for publication or request changes all within a matter of seconds.  Best of all, nothing will get posted without your approval.

3. Free professional looking content in a template

Pablo is an old favourite of mine! It supplies predefined size templates where a user can use free professional stock photos and quickly overlay text. The feature I love most on this tool is the “insert logo” feature, which with the click of a button can overlay a banner or brand element that creates consistent content experiences. Once done, you can export the image and post it to gain for approval. Simple right!

4. Create email alerts for when your brand is found online

Talk Walker alerts is a nifty tool and acts like your personal internet detective who constantly crawls the internet for keywords that you define. I like to use my clients’ brand names and sometimes even my competitors just to keep tabs on their activity. Once set up, you receive daily emails with links to the content in question.

5. Pre-approved marketing creatives and targeting with machine learning optimisation

Lead Gener8or tool can define a bespoke target audience per store and lock advertising geographical areas to prevent any cannibalisation. Once completed, franchisees can execute pre-approved marketing campaigns as and when they wish on any of the integrated channels (SMS, Email, Facebook, Google and Youtube), without any further involvement required from the marketing team.

Powered by big-data machine learning, campaigns are automatically optimised while in flight. Marketing teams can monitor all campaigns in real time. This tool really is a game changer for franchise marketing teams and brand managers.

With these tools correctly implemented into your business, the digital headache of your franchise’s marketing team can subside and focus on what you do best, delivering results!

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Company Posts

Choose A Job You Love, And You Will Never Have To Work A Day In Your Life

Join Col’Cacchio’s 26-year-long love story.

Col'Cacchio

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Vital Stats

  • Joining fee: R125 000
  • Monthly management fee: 6% of turnover
  • Monthly marketing fee: 2% of turnover
  • Total investment: approx. R2.5m to R4.2m (turnkey) Size: 140m2 to 350m2
  • Unencumbered cash (before loan): 50% of total investment

(Above figures exclude VAT) 

“Owning your own restaurant is like owning your own future.” – Dominic Dempers, Franchisee Durbanville, Belvedere & Meadowridge Cape Town

We’re looking for passionate franchisees who will love our brand as much as we do.

Why you should join this delicious success story

colcacchio-pizza-franchise-dessert

  • Assistance with site selection & lease negotiation
  • Store design & build
  • Full training provided for management and staff
  • Marketing & operational support
  • Product innovation & menu development
  • Efficiency in all systems
  • Healthy margins.

Related: 300 Business Ideas To Inspire You Into Entrepreneurship

#FoodwithaStory

“Our journey started with a single restaurant on the foreshore with the aim to serve the very best pizza around” – Greg Mommsen, Business Development Director

“Watching this brand grow and empowering people has been immensely rewarding. We have staff that have been with us for over 20 years. It’s like a family, we work hard, we laugh, we cry, we celebrate and of course, we eat a lot of pizza.” – Michael Terespolsky, Founder and Managing Director

“Becoming a franchisee is an amazing opportunity to join the family and become part of the Col’Cacchio success story. We’re 100% behind out franchises at every step, making sure that we all continue to learn and flourish” – Greg Mommsen, Business Development Director

“It has been filled with challenges along the way, but all the rewards have made every moment worth it.” – Michael Terespolsky, Founder and Managing Director

Related: Got An Awesome New Business Idea? Here’s What To Do Next

Visit www.colcacchio.co.za or call Tarryn Godley on 084 800 7264 and let’s get this adventure going.

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