The vice president of property management for Phillips Edison & Company abides by the management principles of abandoning what’s not working and focusing on innovation. That approach has yielded rich dividends. Emily Lambert
daily so it made sense to use them to source deals,” says Richter. “This gave them a way to earn additional income, as well as help draw customers into their centers.” The ancillary income program differs from those at traditional, enclosed shopping centers, mainly because the portfolio at Phillips Edison differs. Phillips Edison owns and operates 250 open-air shopping centers nationwide, with the typical center averaging 120,000 square feet of retail space with a strong grocery anchor component. Other tenants at a grocery-anchored center typically include a pharmacy; value retailers; small restaurants such as a deli or other local operator; services such as tax preparation, nail salons, dry cleaners; and perhaps a gym or tanning salon. Because the centers are open- air, standard kiosks that are located in malls cannot be utilized. For this reason, Phillips Edison uses their vacant spaces and common areas to generate their ancillary income. Each one of the approximately 20 regional managers in the
Phillips Edison Property Management department oversees 15-18 properties, with management and temporary leasing responsibilities. Richter oversees these regional managers and
their leasing efforts and generates several national leads as well.
The team makes deals with seasonal stores on a national
level where it makes more sense. “If it is easier for us to meet with reps and present our portfolio on a national level versus regional managers calling and setting up individual meetings, we do so,” he says. An example of such a deal was a lease with TNT Fireworks. There are instances, however, where deals crafted on a local level make more sense. For example, car lots will often rent a parking lot for a special show or sale in an area where they don’t have a presence to generate traffic to their long-term location. This deal could be crafted in Florida, for example, but not in Ohio where it is not allowed. “Local managers are more successful in selling the local one-
shop user on the value of establishing their use in our centers,” says Richter. “We’ve also learned that our traditional leases are intimidating to these tenants, so we use a Periodic Tenancy Agreement, which is a much more scaled down version of our full lease document,” Richter says. Terms or conditions that do not apply to a short-term user are not included. “We have
SpecialtyRetail.com Winter 2012 n Specialty Retail Report 93
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