This article discusses the differences between negotiating commercial real estate deals for large national chains versus independent restaurants. For national chains, the decision makers focus mainly on financial metrics like rent costs and occupancy requirements. Emotional factors are less important. However, independent restaurant owners are passionate about their concepts and view their businesses as dreams to create unique dining experiences. The author argues that restaurant specialists can help bridge the gap by understanding both perspectives. They can get owners and landlords to communicate directly, emphasizing the vision and potential customer experience, in hopes of reaching a mutually beneficial deal beyond just bottom-line terms. Negotiating emotionally as well as financially increases the chances of success compared to a strictly numerical approach.

1. Mid Atlantic Real Estate Journal
Covering the States of New Jersey, Pennsylvania, Delaware, Maryland, D.C. and Virginia Vol. 21, Issue 8
Shopping Centers
By Jack Intrator, CPM, RAM, ARM, Zommick McMahon
Emotional
Rescue
W
hen dining at a box dry goods retailer, deal and the benefit of cause the operator has
restaurant, the a bank or an indepen- increased visibility and given in his mind the
process is one of dent restaurant opera- foot traffic, site recogni- limit of the deal, the
emotion. The sensation tor. Sometimes we get tion and the perception VP of Real estate has
of touch, taste, sight and information that can be of their patrons then given all he is allowed
smell are all immediate deemed antiseptic. there is a chance for a to and there is a polar-
and a part of the overall The Restaurant Spe- connection--an emotion- ization that takes place
experience with sound cialist al connection between and heels are dug into
and mood/environment That’s where the res- the chef/owner opera- the ground. Even the
secondary perceptions taurant specialist comes tor and the landlord skilled broker, a restau-
derived from the first into play. We are there directly. rant leasing specialist
four. If we consider the for interception; we are Often I see when the who knows the concept,
above are all factors in the buffer from the Chef/ chef/owner is describing understands both posi-
our experiences when Jack Intrator owner operator to the his concept he embraces tions and understands
dining, then let’s consid- VP of Real Estate work- it. He envisions it and is what needs to be done
er how magnified these some of the same crite- ing for the Landlord. excited by this concept to push the deal over
become when working ria as the bean counters We need to immediately and a good landlord the line, is often at a
on an independent res- in the national chains, process the information sees this spark and pas- loss as there seems no
taurant deal. but there is more, much and present it in a way sion and wants this real movement on either
In a typical big box more. There is a passion that our client both un- concept for the operator side. No opportunity to
operation for a retailer, for the business, the derstands and appreci- and for his tenant. That make the deal, but other
a Target, best Buy or a vision of how they see ates because we know, is when good deals get brokers who chose to
Supermarket or even a themselves and their we understand that this born. When you only specialize in this arena
Restaurant like a Lone concepts. They are the deal will be complet- look at the bottom line will push the deal for-
star, Ruby Tuesday or dreamers who know ed by the passionate of each deal then you ward because they truly
an Olive Garden, the the emotional experi- operator, the business might as well focus on grasp the art of the deal.
decision makers on the ences of dining and it terms of course, and the the card store. If there They will go the extra
tenant side are often gives them pleasure, emotions of the deal. is a chance to capitalize mile, have the straight
a VP of operations, or when they create the We need to get our cli- on a situation and bring talk express with the
VP of real estate. Most panache, and a diner is ents into the space, let both parties together, chef/operator and with
of these types can only happy with their experi- them touch the space, even if your dollars PSF the landlord and get
focus on specific market ence. let them see themselves apart then the old ad- them both to the table.
conditions and demo- Oftentimes when we and their concept in the age “Bring them to the Work the deal out on the
graphics, a business work on a restaurant space and let them con- Table” is implied. table and either make a
model that illustrates deal, whether in a shop- ceptualize their bottom I like to bring the cli- deal or move on. You can
criteria--they have nev- ping center, in a build- line. ent and the landlord to call these aggressive ne-
er been the restaurant ing on a city block or a When working with a the table as soon as I gotiations but it is this
operator or the chef/ new development, we cold business process, get a commission agree- type of negotiation that
owner who truly feels are presenting oppor- like a big box or nation- ment signed. Having a is the only thing that
the experience and that tunities to our clients, al retailer where the VP face-to-face meeting is may save a deal from
point of view. the independent op- of Real estate or a Prop- often all that is needed collapsing.
The chef/owner is erator with information erty Manage does not to see if there is a real At the end of the day,
a very different sort. that is put together and really care if the tenant chemistry between a when we understand
Their motivation is two- directed for a typical is a card store or a res- landlord and an opera- the difference between
fold, and of course they retailer. Demograph- taurant operator and tor. You can’t get chem- big boxes, a national
are motivated by the ics are provided but only sees the bottom istry going with a prop- chain and the indepen-
business and the finan- little information on line. They see who will erty manager or the VP dent chef/owner, we are
cial gain that in their disposable income and pay the most rent, re- of real estate, because truly in a position to
opinion will accompany certain specific aspects quest the least amount they are not entrepre- provide sound advice
a successful concept of the market we need of fit-out, and who will neurs, not the decision and the emotional res-
and operation. But they to assemble ourselves. accept a typical vanilla makers on their own. cue to close the deal
base their decision by When a typical broker shell--this is the hardest But when you get the with both sides feeling
emotion, a feeling they presents the opportu- deal to make. But, when owner/developer across like winners.
have for the location and nity they present in you get a chance to sell the table from the chef/ Jack Intrator CPM,
their vision. They are a vanilla sort of way, the deal, the concept to operator that is when RAM, ARM is a res-
passionate about their and often do so with no the Landlord, explain- you can see progress taurant leasing spe-
concept and their deci- clear or definitive dif- ing the attributes of that would otherwise cialist at Equity Re-
sions can be based on ference between a big the tenant and of the not be forthcoming be- tail Brokers. n
Reprinted from Mid Atlantic Real Estate Journal • 781-871-5298 • 800-584-1062 • 781-871-5299 (fax) • marejournal.com