Nonprofits fill in gaps at shopping centers

At Cameron Village, there is one tenant that pays absolutely nothing in rent.

It doesn't even pay its own utility bills.

That's because the Back Home Box Foundation is a nonprofit, temporarily occupying the spot that was most recently the women's clothing boutique At Ease until a permanent tenant can be found.

Nonprofits may not have the buying power that large national retailers have, but in many cases they are willing tenants who can help shopping centers fill spaces during recessions.

For the nonprofit, it's a rare chance to get exposure to the thousands of people who shop at centers like Cameron Village each month.

For the shopping center, it's a chance to do something good for a local charity, and it helps avoid one of the biggest no-nos in retail: an empty space.

"It's not about always trying to collect the old buck," said Cameron Village property manager Lynne Worth. "You're actually doing something that's good for the community."

In addition to the good will, there are other benefits for Cameron Village, Worth added.

"I've gotten some pretty good exposure from prospects because the door is open and they'll walk in to find out about the nonprofit, and they'll start saying, 'Is this space for lease? How big is it?' ... Someone who's interested can just walk in and look around."

The arrangement is fine for the Back Home Box Foundation, which collects items and money to ship care packages to soldiers overseas. The exposure - in a spot at Cameron Village since October - is irreplaceable, said Van Krebs, who serves on the organization's board.

"We've had people walk up and give us a couple hundred dollars cash," he said. "I like to tell the story about the Broughton High School kid who walked by one afternoon after practice, and he reached down in his pocket and he had like $3 and he put it in the jar. That meant a lot to me."

And even though the site is tenuous - Back Home Box has 72 hours to move out if the space is leased - Krebs said that's fine.

"It's tough; this economy is tough," he said. "If we get $100 in a day, then that's $100 we didn't start with."

Visibly helping

Nonprofits such as the Inter-Faith Food Shuttle have benefited from a glut of space and some good will on the part of area landlords.

In September, the food shuttle opened a Durham satellite office inside Northgate mall where it hosts cooking classes and operates some of its programs, such as Backpack Buddies, which provides food for schoolchildren in need.

The nonprofit covers utilities, spokesman Jason Boone said, but the mall waives the rent.

And the ability to reach out directly to people in the Durham community is invaluable, Boone added.

"When they're looking in the doors and we have volunteers in there packing backpacks or whatever, it puts what we do right there in front of them so they can visualize it," he said.

Northgate also houses a few other nonprofits, including Dress for Success, an organization that helps disadvantaged women get professional clothing for job interviews and jobs.

Triangle chapter founder Pat Nathan said the nonprofit does pay rent but that the mall gives Dress for Success a large storage space and access to other facilities including a conference room for free.

"I think a nonprofit should have some skin in the game, but they make the amount of skin something we can really live with," she said.

And, it turns out, leasing for free or almost free to nonprofits may be a smart business move when it comes to recruiting tenants.

In the long run

Nonprofits can be among the most dependable, stable tenants in a shopping center if they reach the point where they are able to pay the rent.

Share Our Shoes, a nonprofit that collects gently used shoes for people in Haiti and others in need, recently moved to a new space in Raleigh off Capital Boulevard.

The landlord was looking for a long-term lease, and Share Our Shoes was able to negotiate a good discount for signing a five-year lease.

"They were asking $5,000 a month here," said founder Jennifer Pierce. "It's 6,500 square feet off of a main road. We pay $2,500. They really gave us a discount for being here and really signing a long lease."

Depending on the nonprofit, the tenant may be able to give back to the landlord in ways that a typical tenant could not, said Sarah Powers, executive director for the Visual Art Exchange, which has been in downtown Raleigh's City Market since 1996.

"We're willing to do a lot of work and programming and things that wouldn't be maybe as lucrative for a regular business," she said. "It makes it look lively; it looks exciting."

Visual Art Exchange rents its space, but this year, City Market management allowed the nonprofit to begin using a second space that wasn't being rented for art displays and exhibits.

The art exchange has also installed artwork on the side of Big Ed's restaurant, and it runs a program under which the center's trash cans are painted by local art school students.

"We're letting them use the space while it's not rented and while we try to figure out what we're going to do with it," said Christina Coffey, who leases the building for Hunter & Associates. "It puts something in the space that attracts people and makes it look appealing."