By Taylor Williams
There’s nothing free in this world, not even a full-blown, multi-year resurgence in brick-and-mortar retail real estate.
The ferocious revival of physical retail in the post-COVID era, headlined by fewer national bankruptcies, record rental and occupancy rates and renewed investor interest, has slowly but surely been stymied and hamstrung by macroeconomics. Despite real ingenuity and entrepreneurship among today’s operators, the business of leasing retail space in high-growth markets remains fraught with potential deal-killers that go beyond supply-demand dynamics that are favorable to landlords.
For Texas retail brokers who specialize in tenant representation — men and women who genuinely love helping businesses grow, expand and serve their communities — that means taking on fresh challenges day in and day out. It means navigating pitfalls that have a way of consuming the two most valuable commodities on the planet: time and money. It means perfecting the art of self-motivation, of having an
anticipatory mindset and thinking multiple steps ahead. It means embracing the hustle.
Since venturing out on his own following a 12-year career at Weitzman, Matthew Rosenfeld, founder and president of Dallas-based brokerage firm The Rosenfeld Company, has lived and breathed these realities. Rosenfeld’s shop has been open for just over a year now, and while he says he’s “never been busier,” the relentless challenges of the business today make that something of a loaded statement. Rosenfeld’s analysis of the life cycle of a deal underscores how the timeline of retail leasing in particular has changed.
“Getting information ready to go, having real estate committees drive the site, sending out LOIs [letters of intent], signing a lease, conducting sitework and build-outs, securing permits, then actually opening for business — that can take two years from start to finish,” he says. “We have some deals still in the works that started three or even four years ago, so deal time is one of the biggest challenges.”
Working at those tasks every day without getting paid until certain milestones are hit undoubtedly requires a certain mindset. It’s not for everybody. But as Rosenfeld points out, the combination of original concepts, consumer demand and outstanding Texas fundamentals should ultimately make the juice worth the squeeze.
“There are a lot of great clients out there, and the state of Texas and Dallas-Fort Worth [DFW] are top markets for business in general, and especially for commercial real estate,” he says. “There’s still runway for us to do deals; we just have to work harder. And we’re getting chances to add value by doing consulting, getting into the weeds on construction input and helping clients in other unconventional ways that facilitate and finalize deals. That allows us to work with great projects and pick up new listings, but there’s no question that it also requires more time and effort.”
Nick Naumann, senior vice president and director of brokerage in Weitzman’s Austin office, agrees that brokers today must truly be willing to lean into advisory roles to best serve clients, especially if they primarily focus on the tenant side of the market.
“We have to educate tenants on market terms, set expectations on timing, show where deals are getting done right now and understand the economics behind them,” he explains. “Making sure you’re proactive and educating your tenant is super important in this very tight market in which landlords can be selective. And sometimes tenants have to settle for spaces they don’t love because it’s a territory they need to be in or they’re in a time crunch.”
Naumann adds that being in a market like Austin enables him to operate as part of a small cohort of advisors tasked with representing a large segment of users.
“It’s a small network of brokers in Austin, yet there’s so much demand, and just being in the market networking and talking to people every day is very rewarding,” he says. “We’re in the middle of a re-tenanting cycle. Tenants are taking longer and asking more questions in terms of their due diligence, permits and build-outs, and it’s all a bit more expensive now. Giving that guidance on what [constitutes] a fair market deal that keeps everybody in good shape is a big part of what we do.”
Beyond Control
Despite challenges related to time and tenant expectations in retail brokerage, those hurdles still have elements of control within them.
That’s not really the case when it comes to supply and demand and accounting for hard expenses — land and construction prices for owners and occupancy costs for tenants. Those numbers are what they are, and the math that goes into solving for them has a way of being inflexible, even though sources say that many tenants are willing to cut big checks if a space meets their needs.
“There’s a ton of activity today, but retailers are not being cavalier with their decision-making processes just to get into the market due to how [expensive] rents are,” says Elizabeth Herman Fulton, a vice president in CBRE’s Dallas office who does both tenant and landlord representation. “They’ll be selective and aggressive and pay up for the right real estate.”
“But today’s market is such that a great space can become available, and all of a sudden 10 groups are circling it,” she continues. “When that happens, the optionality can lead to some analysis paralysis. That can slow things down, but that’s also part of the blessing of having so much activity.”
Dan Shoevlin is a senior vice president at CBRE’s Dallas office. As a 40-year industry veteran, he recognizes unique differences in deal execution today that simply didn’t exist in the past, and LOIs are one such manifestation of those changes. His analysis also speaks to the unspoken reality that being in a landlords’ market doesn’t necessarily make the jobs of landlord representatives any easier.
“Going back to the days when LOIs were negotiated on napkins over lunch, things have just gotten so much more sophisticated — some LOIs today are really just shortened lease forms,” Shoevlin says. “In some ways, that can make the actual lease negotiations go quicker, but it’s taking longer to get deals done because we have to get through lengthier LOIs and address every major issue that’s going to be in the lease.”
Shoevlin also says when a quality merchandising space in a well-located power or grocery-anchored center does become available, the landlord will “immediately” receive “three to five LOIs.” That means the center’s leasing agent has to vet that many more potential users just to make a single deal. And if the availability in question is a second-generation turnkey restaurant space, the situation often feels like “a feeding frenzy that can quickly become a bidding war,” Shoevlin says.
The combination of low availability and high demand is now relatively entrenched across Texas markets. Consequently, tenant rep brokers are getting more aggressive in terms of monitoring potential availabilities.
“The best tenant rep brokers ping us regularly about certain spaces and ask a lot of questions about how the tenant is doing, when the lease expires and what options they have,” says Shoevlin, adding that this practice represents yet another form of evolution for the business. “Good tenant rep brokers monitor and follow up on those spaces so their clients can get the first shot if they become available.”
Trickle-Down Effect
As Texas markets swell with jobs and people, demand is rife for service-oriented, basic-needs retail, as well as innovative, elective-spending retail — and everything in between. Retail brokers are tasked with navigating and creating value within that tight area of overlap between demand from tenants and consumers and hard economic realities faced by developers and investors.
What does that look like in reality? Another added layer of occupational challenge, of course — and one that can be especially taxing for mom-and-pop tenants and their brokers.
“We went through a change about 10 years ago in which grocers increased their footprints and absorbed ancillary services within their stores that were previously found in shadow-anchored retail developments,” says Rosenfeld. “As a result, developers only built 15,000 to 30,000 square feet of [inline] shopping center space and then pads.”
“That trend has accelerated further due to construction costs,” he continues. “Developers don’t really want to build strip centers right now; they need $40 per square foot, minimum, to get those projects to work, and only national retailers can afford that kind of rent. So it’s a tough market for retail brokers who don’t represent the best tenants, even as development is expanding relative to past cycles. New shopping centers are getting built, but making the economics work prices out a lot of mom-and-pop tenants.”
Sources say that because land bases and construction costs are so high for developers, pad sites have emerged as key sources of revenue on new projects. But whether these parcels are sold to end users or developed via ground leases, once again, those opportunities tend to favor national credit tenants.
“To make these new developments work, you have to have pads; they’re just such good sources of income,” says Naumann. “A lot of developers would prefer to ground lease, but they’ll sell at a premium, which is the cap rate off that ground-lease rent. But to have a successful development, it’s ideal to have multiple pads to work with.”
Therefore, the best source of opportunity for mom-and-pop tenants — especially those that don’t operate as franchises — would seem to be working with landlords that have large, growing portfolios but are not true institutional investment groups. Which is of course much easier said than done. But within that subset of owners, there may be just enough financial and operational flexibility to give mom-and-pops an edge.
“It’s a dilemma that landlords deal with every day, especially in a market like Austin,” Naumann concludes. “You want those high-credit tenants with corporate guarantees and lower risk of default, but you have to have local character, and residents here really like to support local businesses and provide for the community.”
Vetting For The Win
Lane Pleason and Matt McKinnerney both hold the title of vice president of leasing at Read King, a Houston-based owner-operator. While both concede that it’s accurate to describe the current retail landscape as a landlords’ market, Pleason and McKinnerney also know that doing the wrong deal with the wrong tenant can be more costly in this environment.
“Every deal matters more, and our biggest challenge is balancing speed with quality,” says Pleason. “There’s a ton of demand for well-located retail; the challenge is making sure we’re doing the right deal and not just any deal. It’s about making sure that the groups we’re doing deals with fit the long-term merchandising mix at that center.”
The right deal isn’t necessarily the one that brings in the most rent, McKinnerney stresses.
“Sometimes national tenants are the highest rent payers, but their business models may not align or be
well-received by the local trade area,” he explains. “We’ve seen national brands enter Houston and fail for this reason. Curating the ideal tenant mix is a function of not only meeting financial parameters, but also of driving traffic, complementing existing users and the local trade area and working with experienced operators. [Mom-and-pop] tenants that check all those boxes can be competitive with national tenants, and we want to give them chances.”
There are some asterisks associated with that philosophy, however. Again, with new development, an owner’s land basis and construction costs can be so high that the requisite rents will overwhelmingly favor national credit tenants.
McKinnerney says that the process of vetting tenants is yet another way in which the business has changed significantly in the modern era.
“[Vetting tenants] goes beyond just verifying financial statements,” he says. “The process also involves looking at online reviews and social media and experiencing the business in person. We live in an era in which there’s so much data that needs to be taken into account. Landlords don’t want to be just checking a box on rent, but rather doing deals with groups that can be successful
long-term operators and create value for the community.”
Vetting operators in 2026 may be both an art and a science. But without a clear vision from the landlord on the center’s vibe, merchandising mix and role within the community, those efforts may not matter in the long run.
“We’re not just here to fill space; we’re creating centers and tenant mixes that drive traffic and long-term value for stakeholders and also create something cool for customers,” says Pleason. “National tenants can pay higher rents and bring stability to centers, which is obviously an important box to check, but we also have to make sure that centers feel unique and have the right balance.
“You can anchor a site with a strong credit [user], whether fitness, medical or quick-service restaurant, then layer in local operators that bring separate energy and differentiation,” he adds. “It’s all about the environment you want to create for customers.”
— This article originally appeared in the May 2026 issue of Texas Real Estate Business magazine.