Cash-strapped landlord meets retailer in need: see what pops up

Offering short, flexible tenancies in locations once unaffordable, pop-up shops are proving attractive for some businesses

A STORE that appears unannounced quickly, draws crowds and then disappears? Pop-up shops is a phenomenon that is proving attractive for hard-pressed landlords and certain retailers.

Offering short, flexible tenancies in locations that were once unaffordable, this pairing of nimble retailers with cash-strapped landlords is proving to be win-win – in certain situations.

“You have landlords who are keen to get something from a vacant shop so they’ll allow guys in there for a couple of months and continue to market the property at the same time,” says John Garvey, director of estate agent Lisney’s commercial retail team.

“They’ll get a few quid towards the rates or a small amount of rent to cover costs and it keeps the property occupied while they continue to market it,” says Garvey.

For the temporary tenant, it can mean getting a foot in the door of a premium location at a knock down price.

“It’s not a market rent,” says Garvey. “It comes down more to the retailer’s business and what they can afford to pay.”

For one fashion accessories retailer who opened two pop-ups in December, one in a “prime shopping centre in Dublin”, the venture has enabled him to trade in locations he could otherwise not afford.

Wanting to remain anonymous – “I don’t want to burn my bridges” – he says, “we probably would not have been able to get into those centres if it wasn’t for doing a short-term letting.”

Being able to move fast when the opportunity came was key.

“We had a licence done within two days and we opened the store within four days.

“It was only for two months. The chances are, we would not have been attractive as a long term tenant, but the fact was, they were going to have an empty unit coming up to Christmas.”

Setting up two pop-ups with the same stock enabled him to test locations.

“The location with the lower footfall actually did better, probably because of the demographics that were going through the centre better suited us . . . we found that really beneficial because it means we won’t look at a medium to long term lease in the centre that didn’t work for us.”

His says while the disadvantage of pop-up is you may have to shut shop while business is booming, he says he’ll continue to use the model and is looking at high tourist footfall locations for the summer.

Some landlords, however, remain intransigent.

“We’ve made offers on units in the city centre that have been vacant for years and no one has entertained them. I can’t understand that.”

For Joe Macken, co-owner of Dublin chicken eatery, Crackbird, pop-up has become part of his restaurant’s brand.

In its first incarnation, a 12-week pop-up on Crane Lane, Temple Bar, a “completely unproven B property on a side street,” according to Macken, Crackbird was an all-out success.

So why pop-up?

“We had gone through examinership so I wanted to make sure I wasn’t going to jeopardise my own business.

“It’s not that I didn’t have faith in my product but I wanted the opportunity to test it.”

After three months of successful trading, Crackbird closed only to pop-up again in a prime South William Street location.

Diners have until January 22nd before Crackbird flies the coop again, however, having now tested the current location with diners,

Macken says, “we’re happy to commit to it”, and will open a full-time restaurant there, most likely a branch of his Jo Burger chain.

He says being able to use the pop-up model in the current market has enabled his business to grow and he feels the benefits are there for landlords too.

“If they can get someone in for three months and it’s going to pay off a lump sum of their mortgage and pay their insurance for the rest of the year, why wouldn’t they do it?”

Dún Laoghaire Rathdown Council is also getting in on the pop up act, offering empty commercial property in Dún Laoghaire at a low cost to local entrepreneurs.

Tenants pay more than they would for a stall in the local farmers’ market but less than they would for a lease, explains the council’s economic development officer, Wessel Badenhorst.

Participating landlords either continue to pay rates and receive the pop-up fee directly or the council uses the pop-up fee to offset their rates charge.

Fingal and Limerick City Council are now following suit.

But doesn’t the arrangement rile full rate-paying retailers? The issue of consumer rights regarding returns and faulty goods has also been raised

“It’s a balancing act,” Badenhorst concedes. “If you allow tenants to trade for too long, there might be some complaints from retailers. As long as it’s a temporary arrangement, we’ve got the backing of local retailers.”