Glossary definition
Anchor Tenant
A major tenant whose presence in a commercial development attracts other tenants, customers, or footfall, typically occupying a significant proportion of the available floorspace. In retail developments, anchor tenants are usually national retailers or supermarkets; in office schemes, they might be large corporate occupiers.
Definition
A major tenant whose presence in a commercial development attracts other tenants, customers, or footfall, typically occupying a significant proportion of the available floorspace. In retail developments, anchor tenants are usually national retailers or supermarkets; in office schemes, they might be large corporate occupiers. Securing an anchor tenant with a pre-let agreement can significantly strengthen a development finance application by providing certainty of rental income and supporting the exit valuation.
See also
Closely related terms.
Rack Rent
The full open market rental value of a property if let on normal commercial terms without any premium, rent-free period, or discount.
Void Period
The period during which a property stands empty and produces no rental income, whether between lettings or prior to first occupation.
Gross Yield
The annual rental income from a property expressed as a percentage of its purchase price or market value, before deducting any expenses.
Valuation
A professional assessment of a property's market value, carried out by a qualified surveyor for lending, investment, or transactional purposes.
Further reading
Guides that touch this term.
Guide
Commercial Mortgages in the UK: A Complete Guide
Everything you need to know about commercial mortgages in the UK - from eligibility criteria and rental coverage ratios to how lenders value multi-let properties and what lease length matters.
4 min read readReadGuide
How Does Development Finance Work? A Complete Guide for UK Developers
A ground-up guide to how development finance is structured in the UK, covering loan mechanics, drawdown schedules, monitoring surveyors, and what lenders look for in your application.
5 min read readReadGuide
The Capital Stack in Property Development: How to Structure Your Funding
A comprehensive guide to understanding and structuring the capital stack in UK property development, from senior debt through mezzanine to equity contributions.
9 min read readRead
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