Streets lined with retailers and restaurants create excitement, with window displays, shoppers walking in and out of stores, and people wandering the neighborhood. Everyone loves to walk in neighborhoods with exciting streets but no one wants to walk streets lined with vacant storefronts.

Vacant stores seem to jump out at you. They can be the result of changing demographics in a neighborhood, competition from better retail areas or shopping centers, neighborhood neglect and difficult economic times.

Today's vacant stores are primarily the result of the recession. Only time and economic recover will bring retailers and restaurants back to vacant stores.

Community asset

Can vacant stores be an asset to their neighborhood until permanent tenants are found?

Cities, community groups and property owners can learn from mall managers how to turn vacant spaces into productive assets. Malls have specialty leasing programs to temporarily fill vacancies until permanent tenants are found.

A specialty leasing program, or temporary tenant program, leases vacant spaces to tenants and sometimes provides spaces free to community groups.

One example of malls' specialty leasing program are the kiosks and carts that line the center of malls during the Christmas season. They are occupied by new businesses testing a concept or established retailers wanting to capitalize on the Christmas selling season.

Everyone benefits from these temporary tenants. The retailers are successful, landlords get rent for the kiosks and we have dozens of unique specialty retailers to shop.

Another component of a specialty leasing program is finding temporary tenants or other users for stores that are vacant until permanent tenants are found. Some temporary tenants are incubator businesses or startups testing a concept without a major investment in store finishes and signing a long-term lease. Established retailers will lease space for a short term to sell excess inventory or make special purchases for the store.

Temporary tenants lease space for a limited period and install basic improvements expecting to capitalize on a selling season and or low rent.

Upscale versions of temporary tenants are “pop up” stores. This is a relatively new concept. A pop up retailer will lease space for six months or a year or two and build out the store to their typical standards with the expectation of selling a lot of merchandize. Pop up and temporary tenants pay rent but usually at a discount, offsetting some of the landlord's lost income from vacant spaces.

There are other uses for vacant spaces when retailers cannot be found. Existing stores can be offered the opportunity to decorate vacant store windows with their merchandize and promote their location. This lets mall merchants promote their merchandise in another section of the mall and or lets retailers on one street promote their stores on another block.

Another use for vacant spaces is offering them to non-profit groups. These groups decorate the windows with information about their services, and ideally staff the spaces to provide their services. A third alternative is to offer vacant spaces as temporary galleries or artist work areas.

The details

A license agreement, not a lease, is used when vacant spaces are leased to temporary tenants and community groups. The agreement has a 15- to 30-day cancellation provision to accommodate permanent tenants. Landlords lose money on vacant spaces, money needed to cover expenses and mortgage. It is only fair that temporary users move out when a rent paying permanent tenant is found. Permanent businesses are better for the street and the neighborhood than temporary tenants.

Vacant spaces are provided to tenants or other users as-is. When the user is a non-profit or community group, no rent is charged, but they pay utilities and return the space in clean condition.

Finding uses for vacant spaces in a mall is simpler because one company owns the mall and has a specialty leasing coordinator who administers the program.

In a neighborhood there are different owners for almost every building and no one to coordinate such a program. Finding organizations to use vacant spaces is not as easy as it may seem. While every organization would like free space, another location can pose logistic and staffing challenges.

Merchandising vacant storefronts with temporary and pop up retailers, community groups and the arts community adds excitement and activity to the streets. Existing business no longer have vacant stores next to them, streets become interesting again with more pedestrian traffic, and vandalism and graffiti is reduced or eliminated.

A city, landlords and neighborhood groups can work together to create their own program to turn vacant stores into community assets.