While some traditional brokers accumulate empty premises and owners more willing to negotiate, others maintain high values that are difficult to sustain. Which areas offer the best relationship between cost and commercial potential, which are the areas that continue to grow and why location is no longer the only key to success
From a premises of 40 square meters per US$ 1.500 monthly near Rivadavia Avenue up to a space of 120 square meters in Puerto Madero with a rent of US$ 9.000. This breadth of values reflects a commercial premises market that is undergoing a profound reconfiguration.
That is to say, while some historic corridors show growing vacancy and rents that are beginning to be negotiated, others still maintain prices that many businesses can no longer sustain.
To Oscar Puebla, architect and owner of Puebla Inmobiliariathe change goes far beyond a question of prices since, as he understands, “e-commerce, social networks and new consumer habits have modified the logic of the market and forced us to rethink a paradigm that for decades seemed unalterable.”
«Therefore, a good location no longer guarantees the success of a business. Although it is still important, today it matters much more whether the business model is sustainable,» he summarizes.
The expert explains that comparing commercial corridors solely by the value of rentals or by the number of people circulating can lead to erroneous conclusions.
«Santa Fe, especially between Recoleta and Callao, along with Quintana and Arroyo, continues to concentrate the segment with the greatest purchasing power in the City. Consumers with very different purchasing habits predominate there from those that can be found in other commercial hubs. On the other hand, avenues such as Rivadavia, Cabildo or Pueyrredón receive a much greater pedestrian flow thanks to public transportation, but they respond to more massive consumption,» he specifies.
For this reason, the real estate advisor states that, “the success of a store depends less on the number of people who pass through the door than on the match between the client’s profile and the product or service offered.”
Where opportunities appear today
The transformation of the market resulted in the beginning of opportunities in locations that until a few years ago were practically inaccessible.
In traditional corridors you can find establishments from 40 and 50 square meters with rentals starting from US$ 1,500 monthly in sectors near Rivadavia Avenue, while properties with similar characteristics located near Santa Fe reach values close to US$ 4.000.
The highest commercial concentration continues to be between Córdoba, Florida and the Pacific areaalthough even there the offer grew and many owners show a greater willingness to negotiate.
According to Puebla, «the objective is no longer to indiscriminately lower rents but to find tenants capable of sustaining long-term projects. Before closing an operation we want to know what business is going to be established. We prefer to negotiate the value with a solid venture than to sign a contract that lasts a few months,» he says.
Among the most notable changes, the specialist points out Florida Street: “Historic corners such as Florida and Lavalle or Florida and Tucumán currently have numerous empty stores, a situation unthinkable years ago.”
Even with the arrival of Chinese companies dedicated to different commercial areas, vacancy persists. For Puebla, the phenomenon shows that “the location lost part of the prominence it had for decades.”
Today there are premium brands that sell almost all of their production on Instagram, ventures that serve exclusively by appointment in Recoleta departments, and businesses that use the premises solely as a showroom or experience point for the customer.
The case of Puerto Madero summarizes the difficulties of some premium brokers.
Puebla manages a local 120 square meters located on Juana Manso and Rosario Vera Peñalozaone block from the Hotel Madero, where a bar previously operated.
The requested rent is US$ 9,000 monthly. For the specialist, “value is difficult to absorb for most gastronomic ventures.”
“The business starts with a fixed cost close to US$ 10.000 between rent and expenses. Then you have to add personnel, supplies, services and maintenance. There are very few projects that can generate the revenue necessary to sustain that structure,” he acknowledges.
For this reason, he considers that “only very consolidated companies or brands with different cost structures could set up shop there.”
The case of Av. Julio A. Roca (Diagonal Sur)a few blocks from Plaza de Mayo, could be an opportunity for franchises. That area constitutes another side of the market.
He gives as an example a place of 70 square meters plus basement that has remained closed for more than three years, after the closure of a computer store. The property is offered for rent for US$3,000 monthlya value open to negotiation.
Rentals between US$1,500 and US$9,000 reflect a market that is redefining its rules. From the center to Puerto Madero, the values show an increasingly disparate market.
«The strategy is no longer just about finding a tenant willing to pay that amount. The real estate agency works together with the owner to attract gastronomic franchises and even analyzes schemes where part of the rent is linked to the business’s turnover percentage,» he says.
And he maintains that «the area has offices, tourism and a lot of movement. The problem is not the location but rather finding an activity that can be developed with a reasonable cost structure.»
Gastronomy and well-being lead the demand
While some sectors reduce surface area or abandon traditional premises, others continue to expand.
Gastronomy, specialty cafes, services linked to well-being, health, personal services and certain franchises continue to lead the demand for commercial spaces.
On the contrary, many clothing, computer and consumer products businesses migrated a good part of their sales to the digital channel, reducing the need to maintain large stores on high-cost avenues.
Puebla predicts that “Occupancy will gradually recover, although the process will depend on owners and tenants adapting their expectations.”.
In the best corners, values remain relatively firm, but in much of the market there is already a greater willingness to negotiate rents, terms and conditions rather than keeping a store empty for months.
In his opinion, Buenos Aires is going through a stage similar to what other cities have already begun to experience. He cites Madrid as an example, where some unoccupied commercial premises began to be converted into homes through agreements with consortia.
«You don’t have to fall in love with an address. You have to fall in love with the business model. Today a sustainable rental is worth much more than a prestigious corner that ends up putting profitability at risk,» he advises.
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