Many articles currently being written about retailers and their real estate holdings include references to “rightsizing the portfolio,” “integrating internet sales with bricks and mortar,” and a focus on “efficiency rather than scale.” These business practices have been felt throughout the retail landscape from suburban malls to standalone convenience stores, restaurants and bank branches.
As technology continues to reduce the space needs of today’s retailer, the disposition of surplus properties can present a challenge to even the most seasoned real estate teams. Marketing timeframes for land and existing buildings, particularly in 2nd and 3rd tier markets, continues to increase. Investor and developer interest in vacant or value-add properties are limited by stricter lender, compounding the challenge.
In this difficult landscape, corporate barter has emerged as an efficient real estate solution for retailers; especially for hard to move locations or broad portfolios in need of downsizing. These transactions can offer deal terms that are not possible in the traditional cash marketplace including premium pricing and certainty of close, typically within 60 days. Property owners recoup that value by placing a pre-specified amount of planned media through the corporate barter company.
ICON International was the first barter company to do a real estate transaction 20 years ago. Since then they have transacted on over 40 million square feet of owned and leased real estate. For more information on retailer scenarios in barter, please see them at the ICSC show, RECon Booth S329 S Street. Or, email Jim Tully, VP Real Estate at jtully@icon-intl.com.