Shopping Center Business is the leading monthly business magazine for the retail real estate industry.
Issue link: http://shoppingcenterbusiness.epubxp.com/i/817746
POP-UPS 282 • SHOPPING CENTER BUSINESS • May 2017 and west coasts, pop-up leasing is a flexi- ble, dynamic line of business that has been cultivated by Mike Kelleher, vice presi- dent of specialty leasing for retail and of- fice, and his team for the past nine years. When asked how Federal Realty defines a pop-up, Kelleher jokes, "Do you have an hour?" "If you can think of it, we can do it." Federal Realty executes more than 1,000 leases for pop-ups each year. The leasing process is designed to enable any size or type of retailer to get into business in a matter of days. "We pride ourselves on turning deals around in 24 hours," Kelleher says. "We took our license agreement from 26 pages down to seven pages. That ease-of-entry piece of building our business model was important. If you called me this morning, you'll have a license agreement tomorrow, and you could conceivably be open within a week. There are not a lot of hoops to jump through." Federal has had success in many cate- gories including women's apparel, jewel- ry, chocolatiers, craft brewers and even swing sets and cars [see sidebar for Fed- eral's Hello Kitty truck pop-up]. Matching pop-up leases to the right en- vironment is an important piece of mak- ing them work. "I think the perception is that [the businesses seeking pop-up space] call us," Kelleher says. "Sometimes we do get calls, but that's not the majority. We source anywhere and everywhere." This includes following kickstarter.com or Shark Tank for innovative new business ideas that could entice people to come visit a property. Kelleher says the most exciting part of this type of leasing is that it's a blank canvas. "Hosting pop-ups at our property is a win-win for all involved, but opportunity is not always knocking," he says. "You have to have feelers out across multiple platforms, and you can't do it in a silo. Our success has been built by our com- pany and our partners. In Miami at Shops at Sunset and Coco Walk, we are partners with The Comras Company and they are our biggest asset." Because most of the appeal of pop-ups are that they present rarified or super-lo- cal items, flexibility is also important when it comes to rents. Many pop-ups are actual moms or pops, so dealing with a stay-at-home mom who makes jewelry on the side is different than leasing with a global retailer. "I wanted to make sure in our model that we avoided a rate card or a cost per Pop-ups have evolved beyond temporary retailers; many concepts are now traveling road shows, like Hello Kitty, which brings several concepts to centers. Pictured is a Hello Kitty Café pop-up, courtesy of Federal Realty Investment Trust. I n July 2015, Federal Realty Invest- ment Trust's Santana Row in San Jose, California, featured the Hello Kit- ty Café, a food truck-inspired pop-up selling items like hand-decorated mini cakes and gingerbread houses with a retail pod set up next to the truck. All the forces of marketing and timing con- verged for this pop-up, and Federal saw an uptick in traffic at the center spike into the thousands. "Words almost cannot express how well this pop-up has done at all of our participating centers," says Mike Kelle- her vice president of specialty leasing, retail and office, for Federal Realty In- vestment Trust. "While pop-up sales numbers were not shared, we did see across the board direct impact on lunch activity at restau- rants with the centers, a surge of en- gagement on social media, and in most cases, news of the Hello Kitty pop-up coming to the center was within the top three posts on center Facebook pages the month they were there. It brings revenue for the center, an unexpected fun experience and a positive impact for tenants." The Hello Kitty Cafe has since made appearances at Assembly Row in Somerville, Massachusetts, Bethesda Row in Bethesda, Maryland and Pen- tagon Row in Arlington, Virginia, and many more are planned for the remain- der of 2017. The strength of the first pop-up led to the second and then to a larger commitment to take Hello Kitty to 20 centers within Federal's portfolio. "The success of our partnership and subsequent pop-ups with Hello Kitty is tied to three things: The strength of our real estate location, our ability to exe- cute in 24 hours, and our communities — when they tell us on social that they'll be there, they show up!" — Lynn Peisner HELLO KITTY POPS UP SHOPPING CENTER VISITORS