Took the ground floor bay for my own shop, and the apartments stayed empty

This one is on the tenant side of mixed-use rather than the owner side, and I wish someone had walked me through it before I signed.

A developer finished a small building near me, 18 apartments over two ground floor bays. The pitch was straightforward. Eighteen households upstairs, more buildings coming on the same block, and a corner with real foot traffic once the neighborhood filled in. I signed a five year lease at $2,300 a month on 1,150 square feet, with three months free at the front and a personal guarantee on the whole term.

What I did not check was the lease-up schedule upstairs. The building was 30 percent occupied when I opened and it was still around 60 percent fourteen months later, because they priced the apartments for a neighborhood that had not arrived yet. My walk-in count was roughly a third of what I planned around. I was covering the shortfall out of the other side of my business.

I got out at month 19 by paying a termination that came to about $18,000, plus I left roughly $10,000 of buildout in the space. Call it $28,000 and a year of stress.

What I would do differently: ask for the current occupancy of the residential portion in writing before signing, ask what the lease-up looked like in the last 90 days, and negotiate the guarantee down to a fixed number of months instead of the full term. A lawyer in your state should look at the guarantee language, that part is not something to eyeball.