How Underwrite handles Retail.
Retail is the asset class where tenant-level analysis matters most. The engine handles retail as a per-SF asset, with the same NNN-ish opex profile as industrial. Operating Snapshot surfaces Rentable SF, Rent / SF / Yr, Vacancy, Cost / SF, and Y1 NOI / SF. The Anchor Tenant Loss stress overlay approximates the cotenancy cascade that follows from losing a credit-tenant anchor.
What the engine surfaces natively
On any Retaildeal, the in-tool Operating Snapshot replaces generic schema labels with the asset class's native vocabulary:
- Rentable SF. Total leasable retail square footage.
- Rent / SF / Yr. Annual rent per SF. Grocery-anchored centers typically $15-30/SF base; high-street retail $50-300/SF.
- Vacancy. Stabilized vacancy. Stabilized retail rarely exceeds 25%; value-add can hit 50% but anything above that is essentially a vacant box.
- Cost / SF. Purchase price divided by SF. Wide range: $150-300/SF for grocery-anchored; $500-1,500/SF for high-street.
- Y1 NOI / SF. NOI per SF; the primary cap-rate-adjacent metric.
Property-type-aware validation bands
Validation guards in lib/engine/validation.ts use these tighter bands for Retail instead of the generic defaults:
- Property management % of EGI: 2-6%. Standard institutional band. NNN retail can run thinner; mom-and-pop centers run higher.
Asset-class stress scenarios
The ScenarioBar surfaces these stress overlays when Retail is the current property type:
- Anchor Tenant Loss. Vacancy +20pp, rent growth to 0, exit cap +100bps. Models the cascade from losing an anchor: cotenancy clauses, percentage-rent resets, slower re-lease.
- All four generic stress scenarios (Base, Recession, Rate Spike, Aggressive) are also available on Retail deals.
Example deal: Riverbend Grocery Center
The Retail pre-built example computes to the headline values below. Click into the tool to edit any input and watch the engine recompute live, or open the IC memo to see the full deterministic output.
Current model boundaries for this asset class
These are the Retail-specific institutional features Underwrite deliberately routes to analyst review today. The full list across all asset classes is at /methodology/beyond-phase-1.
- CAM (Common Area Maintenance) recoveries are not modeled. Real NNN retail leases have a tenant-reimburse cycle for property taxes, insurance, and CAM expenses.
- Percentage rent (overage rent tied to tenant sales above a breakpoint) is not modeled.
- Co-tenancy clauses are not modeled. Anchor tenant loss often triggers rent reductions or termination rights on inline tenants.
- Tenant credit / sales productivity data is not surfaced.