Concept
Split L1 three ways: the west and east roll-up doors open directly onto the street as entrances to two small, high-value retail shops (55 m² each). The center roll-up remains a vehicle entrance leading into covered parking behind the shops and north of the cores. Fire-rated partition walls separate the shops from the parking zone. This hybrid captures street-level rental income from the two best-positioned frontage bays while still providing 10 covered parking spaces for the building's upper-floor tenants.
L1 hybrid plan
15 × 30 m · 2 shops + 10 parking spaces · north up
Layout details
- Shop A (west)
- 55 m² behind roll-up 1 · street frontage · counter, prep, stock, WC · own entrance
- Shop B (east)
- 39 m² (narrowed to 3.5 m by pedestrian corridor) · street frontage · own entrance · independent lease
- Shop ceiling
- 4.5 m industrial clear height — option for mezzanine storage (+25 m² each)
- Parking entry
- Center roll-up 2 → 5 m drive aisle running north
- Parking spaces
- 8 covered spaces — all in north (rear) half behind cores — 5 west-north, 3 east-north, 2 center-south of cores
- Fire separation
- 2-hour fire-rated partitions between each shop and the parking zone
- Cores
- W stair, freight elevator, E stair unchanged · shops access the stairs for upper-floor pedestrian traffic
How the roll-up doors work
- Roll-up 1 (west, rear): vehicle entry to west parking row, replaced with glass storefront + personnel door for daily use. Customers walk in from the street directly.
- Roll-up 2 (center, rear): main vehicle entry into drive aisle. Remote-controlled, tenant fob access.
- Roll-up 3 (east, rear): vehicle entry to east parking row — glass storefront conversion for street presence.
Why small shops command higher rents
In Zhongshan's industrial zones, the rental rate per m² increases as shop size decreases. A 55 m² shop with direct street frontage and a roll-up-sized opening is the sweet spot for high-turnover retail.
| Factor | Large bay (110 m², kent4) | Small shop (55 m², kent7) |
|---|---|---|
| Tenant pool | Limited — needs a business with enough volume to fill 110 m² | Deep — milk tea, barber, phone repair, mini-mart, bakery, courier pickup |
| Rent per m² | ¥6–8/m²/day | ¥8–12/m²/day (30–50% premium) |
| Vacancy risk | High — losing one tenant loses 1/3 of L1 income | Low — losing one shop still leaves the other + parking |
| Fit-out by tenant | Often landlord-funded (¥200–400k per bay) | Tenant-funded — small operators fit out to their own spec |
| Lease term | 3–5 yr (hard to replace) | 1–3 yr (easier churn, rent escalation) |
Shop fit-out (landlord scope)
| Item | Per shop (¥) |
|---|---|
| Glass storefront + door (replace roll-up) | 35,000 |
| Electrical (lighting, power points, sub-meter) | 15,000 |
| Plumbing (sink + WC rough-in) | 12,000 |
| Fire separation wall (2-hr rated) | 18,000 |
| Floor (basic polished concrete) | 8,000 |
| HVAC split (1 unit per shop) | 6,000 |
| Per shop total | ¥94,000 |
| Both shops | ¥188,000 |
Parking fit-out
| Item | Cost (¥) |
|---|---|
| Floor coating + line marking (reduced area) | 25,000 |
| LED lighting + motion sensors | 15,000 |
| Ventilation (exhaust fan + CO sensor) | 12,000 |
| Speed bumps, bollards, signage | 8,000 |
| Fire (sprinklers in parking zone) | 20,000 |
| CCTV × 3, fob access on center roll-up | 15,000 |
| Parking total | ¥95,000 |
Total L1 fit-out: ¥283,000 (shops ¥188k + parking ¥95k). Compare: kent5 all-commercial ¥1,000,000 · kent6 all-parking ¥155,000.
Pro forma — kent7 vs. kent5 vs. kent6
| Kent5 3 commercial bays | Kent6 16-space parking | Kent7 2 shops + 10 parking | |
|---|---|---|---|
| L1 fit-out | ¥1,000,000 | ¥155,000 | ¥283,000 |
| Shop annual gross | ¥250,000 | — | ¥200,000 |
| Shop NOI (10% opex) | ¥225,000 | — | ¥180,000 |
| Parking revenue | — | ¥0–57,600 | ¥0–36,000 |
| Upper-floor ADR lift | — | +¥50–80k/yr | +¥30–50k/yr |
| Covered spaces | 0 | 16 | 10 |
| Street activity | High (3 storefronts) | None | Good (2 storefronts) |
| Combined L1 NOI | ¥225,000 | ¥0–58k | ¥180–216k |
| L1 cap rate | 22.5% | 0–37% | 64–76% |
Kent7 sweet spot: recovers 80% of kent5's shop NOI (¥180k vs ¥225k) while adding 10 parking spaces that kent5 completely lacks. Fit-out is 72% cheaper than kent5. The 2 small shops are easier to lease than 3 large bays, and losing one shop only costs half the retail income. The ¥45k/yr NOI gap vs. kent5 is more than offset by ¥717k less capex (payback on the difference: never — kent7 is cheaper and nearly as profitable).
What fits in a 55 m² shop?
High-value tenants (¥10–12/m²/day)
- Milk tea / bubble tea (奶茶) — tiny footprint, high margin
- Phone repair + accessories
- Barber / nail salon
- Bakery / pastry takeaway
- Courier pickup point (菜鸟驿站)
- Mini pharmacy (药店)
Moderate tenants (¥8–10/m²/day)
- Convenience / snack shop
- Laundromat (self-service)
- Print / copy / ID photo
- Dry cleaner drop-off
- Pet grooming
- Tailor / alterations
At ¥10/m²/day: each shop grosses ¥200,750/yr. At ¥8: ¥160,600/yr. The pro forma uses a blended ¥100k/shop — conservative.
Parking allocation (10 spaces)
| Floor | Spaces | Rationale |
|---|---|---|
| L5 boutique guests | 3 | Premium perk for Airbnb listing |
| L3 office tenants | 4 | Included in lease (key commuters) |
| L4 long-stay residents | 2 | Assigned by lease priority |
| L2 monthly / overflow | 1 | First-come or waitlist |
10 spaces is tighter than kent6's 16 — but still a major advantage over kent5's zero. The 2 shop tenants can park e-bikes or motorcycles inside their own bays (common practice in Zhongshan industrial shops).
Storefront conversion — roll-up to glass
The existing roll-up doors (~3.5 m wide × 3.0 m high) are retained in the wall frame but replaced for daily use:
- Option A — Full glass: aluminum-framed shopfront with 1.2 m personnel door + fixed glazing. Roll-up mechanism removed. ¥35k installed.
- Option B — Half & half: keep roll-up operational for large deliveries (furniture, stock pallets), add a glazed personnel door beside it. ¥22k — cheaper but less polished street presence.
- Recommendation: Option A for both shops. The full glass frontage signals "real retail" rather than "converted warehouse" — critical for attracting quality tenants and justifying the ¥10+/m² rate.
Open questions
- Do the shops share the building's water/sewer, or get independent meters? Independent is cleaner for lease accounting (¥5k install per shop).
- Signage: each shop will want a lit sign above the storefront. Pre-install conduit and a sign band in the landlord scope so tenants don't drill into the facade ad hoc.
- Could a third micro-shop fit in the north end of the parking zone (behind cores)? ~30 m² facing the north wall — no street frontage, so low rent, but useful for storage/workshop tenants.
- Grease trap: if either shop is F&B (likely for at least one), the shared sewer needs a grease interceptor. Budget ¥8k, install during fit-out.
- Noise: shops generate foot traffic and delivery activity at the building entrance. L2 residents above may notice — consider acoustic insulation in the L1 ceiling (¥15–20k).