Strip Mall Business Plan, Marketing Plan, How To Guide, and Funding Directory
The Strip Mall Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Strip Mall business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.
Your Business Planning Package will be immediately emailed to you after you make your purchase.
- Bank/Investor Ready!
- Complete Industry Research
- 3 Year Excel Financial Model
- Business Plan (26 to 30 pages)
- Loan Amortization and ROI Tools
- Three SWOT Analysis Templates
- Easy to Use Instructions
- All Documents Delivered in Word, Excel, and PDF Format
- Meets SBA Requirements
Strip malls are popular real estate investments a given that they are able to generate highly predictable streams of rental income from commercial clients. Of course, the capitalization rate for the strip mall is significantly higher than a residential property investment given that commercial enterprises carry a higher degree of default rate then there other real estate investment counterparts. As such, it is imperative that the owner of a strip mall have a well-defined tenant screening policy in place in order to ensure that any default or missed lease payments can be dealt with appropriately and kept to a minimum at all times. Strip malls typically have a start up costs or acquisition cost of $250,000 all the way up to $5 million depending on the location and number of retail space is available. Given that this is a real estate based business almost all real estate based financial institutions, banks, and lenders are willing to put up the necessary capital in order to complete the development or the acquisition. Typically, it can be expected that a real estate investor who wants to acquire a strip mall facility will need to put up a 20% capital infusion as the down payment. Additionally, most real estate investors to maintain significant funds outside of the down payment in order to pay for any unexpected expenses or tenant defaults that may occur during the course of normal business operations.
Given that this is a commercial property acquisition, a strip mall business plan is going to be required. This business plan should include a three-year profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratios page. Unlike most traditional financial statements, a financial statement that is specific for a real estate investment or a strip mall should feel focus significantly on the net rental income less any expected vacancies. A CPA or qualified financial advisor can assist a real estate investor with developing this aspect of their business plan. Within this document as well, a thorough demographic analysis showcasing the population size, population density, percentage of population located within 5 miles of the strip mall, median household income, median family income, and median household value should be included as well. These demographics are not only important for a lender to see but also any potential retailer that will be acquiring space within the strip mall facility. It has now become standard that these companies provide their potential clients with a full demographic analysis coupled with a financial statement to show that the mall facility is in good economic condition.
As it relates the strip mall marketing plan, this needs to be done on two fronts. Foremost, as it relates to developing relationships with retailers – a real estate brokerage should be retained in order to ensure that the lag time between vacancy and fulfillment is kept to an absolute minimum. Generally, in a busy market – the time that it takes to fill a vacancy for a commercial property is roughly 3 months to six months. This is a much longer lag time then with a residential real estate investment. A website should be developed that showcases the facility, the retailers that are currently having locations there, preliminary rental pricing information, and contact information about the marketing company. Two, a portion of the marketing plan should be dedicated towards having the owner provide some level of marketing support as it relates specifically to driving for traffic to the facility. This will ensure that potential retailers are able to have a significant number of customers come to their businesses on a daily basis. Many retailers will value this type of additional marketing given that’ll create a value-added nature to any lease expenses that they incur as part of their business operations.
A strip mall SWOT analysis should be developed as well. As relates of strengths, provided that the strip mall is in a good location the near 100% occupancy can be maintained at all times. The revenues generated from these services are considered to be very high gross margin and they are guaranteed by a contractual obligation. As such, a properly managed real estate investment can produce profits in any economic climate. For weaknesses, there is always the potential for a real estate developer to acquire a nearby parcel of land and to put up a similar facility near that of the existing strip mall. However, this is a risk faced by any real estate based business and is really not too much that can be done about it. For opportunities, outside ensuring 100% occupancy is really nothing that can be done in order to continually boost to the revenues of the business outside of a major economic growth. Within that specific target market. Of course, any real as the entrepreneur is free to acquire additional strip mall facilities in order to increase the size of their real estate portfolio. For threats, there’s really nothing outside of a major economic recession that would impact the revenues of a strip mall facility. However, many retailers have begun to shrunk their brick and mortar operations given that more and more commerce is occurring online. This trend is expected to continue in perpetuity. As such, the owner of a strip mall facility were similar commercial property needs to be prepared for the fact that the demand for these retail spaces may not be as high in the future.