If you're looking to diversify your portfolio, investing in a new type of commercial property is a sound option. Retail space on the Gold Coast is immensely popular – the CBD is a major tourist hub, and retailers will find success setting up shop in the right location.
And that's what the performance of a retail property really comes down to – the location. Buying a retail space to lease to businesses could be a boost to your income, but you need to know what retailers look for in the ideal property.
Think about the most appealing stores you've ever been to – what do they have in common? They're all in the best spots. They're easy to get to, or they're on a cool street, or they're in a magnificent building that leaves an impression on you. It's not all about where it is on a map (although a CBD address on the Gold Coast can't hurt). There's no one shopping district in southeast Queensland.
Try to put yourself in the shoes of the business manager you want to lease to. What sort of business do they run, and where would that business fit best? If it's a vintage clothing store, a small space in the city with offices on both sides might not be the best option. For one thing, the closest customers are corporates, and they might not be on the hunt for vintage clothing as much as students, for example.
If you want to buy a retail space in an office-heavy part of a suburb, you'll want to lease to businesses that have a customer base in corporate lifestyles. A tailor of fine suits, a gadget store, even an upmarket homewares shop might be successful options.
This investment will form a part of your portfolio, so you don't want to make it something you despise. If you're not a fan of hipster cafes, don't buy in an area where they are plentiful. Also, don't lease your space to them – simple.
Instead, think about the sorts of businesses you like (be it a shoe shop, or maybe a sporting goods retailer) then find a space and location that appeals to the market. Businesses want lots of foot traffic, a space they can make their own (ideally one that isn't worn and tired), and somewhere with great street appeal. The better it looks from the outside, the more people will want to check out the inside.
In 2015/16, retail trade was the largest industry in the Gold Coast City, employing more than 34,000 people from the region, according to .id.That's equivalent to 13 per cent of the total workforce in the Gold Coast City – a huge proportion, and something investors can take advantage of.
Clearly, retailers on the Gold Coast enjoy success. Without a strong workforce, there wouldn't be a way to generate revenue they can use to expand and improve. When you have expanding retailers, they need more spaces to move into, and that's where your investment could come in handy.
Research what stores are doing the best in a particular region, then attempt to find a property that will work for that type of business. If you notice high-end clothing stores are booming in the CBD, look for a modern, sophisticated retail space in the area and market it to those sorts of retailers. Keep a close eye on the business successes and failures in the area and you'll have a fair grasp of where you're likely to find successful lessors.
For more information and buying a retail property that works for your interests and builds on your investment portfolio, contact Ray White Commercial Gold Coast today.