What extra risks does a buyer take on if a commercial plaza has vacant units at the time of purchase?

Vacant units shift real risk onto a buyer that a fully leased property doesn't carry. The most obvious is lost income, since vacant space generates no rent while still costing money to maintain, heat, and insure, but the risks run deeper than that. Leasing up a vacant unit often requires offering inducements like free rent periods or tenant improvement allowances to attract a new tenant, meaning the buyer may need to spend money before that space starts producing income at all.

Vacancy can also affect financing and appraisal, since lenders and appraisers weigh a property's income using its actual occupied rent roll. A plaza with several vacant units may not support the same loan amount or valuation as one that's fully leased, even if the space could theoretically be filled. On top of that, a higher proportion of common area maintenance costs typically falls on the remaining, occupied tenants, or the landlord directly, when other units sit empty, since there are fewer tenants to share those costs.

Buyers looking at a plaza with vacancies should factor leasing costs, timeline, and reduced near-term financing capacity into their underwriting, rather than assuming vacant space is simply upside waiting to be captured.