Best size spaces for CRE for highest ROI and lowest vacancy
What is the best size spaces to have in CRE strip centers for highest rents and most demand? I have found that a 3500 sf in a strip center renting for $23 sf/yr but then a smaller 1200 sf in same center and location of center for $30 sf/yr. 

Is this common for the smaller spaces to get a lot more in rent than the bigger units if so what is the best size spaces to have?
[{"id": "iqwpacr", "text": "Yes, on a PSF basis, smaller CRUs can generally command higher rents. \n\nThey are also less efficient, more management intensive, more prone to long term vacancy, generally involve tenants with worse covenants, and the acquisition strategy becomes challenging to scale up as the amount of capital you deploy increases. Many will also be dependent on the continued presence of a large anchor tenant and without owning that larger asset, you'll have no control over that anchor tenant staying or leaving.\n\nSo like everything, higher yields come with higher risk.\n\nAdd: you'll also have more competition which can suppress lease rate growth or aggravate long term vacancy. Tenants needing 3,500 SF will generally have many more options than tenants needing 35,000 SF in a given market.", "replies": [{"id": "iqwqnay", "text": "Great summary here.  \n\nI'd also add that smaller buildings cost more PSF to build so they get higher rent.", "replies": [{"id": "iqwr1gx", "text": "Good addition.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "iqwyt7d", "text": "1500-2500sf contractor garages. Shits lease like hot cakes", "replies": [{"id": "iqx1gu1", "text": "Who leases them ?", "replies": [{"id": "iqx1i76", "text": "And what kinda rates do they usually pay ?", "replies": [], "depth": 3}, {"id": "ir0xq6v", "text": "Depends heavily on the area. I\u2019m in the Atlanta MSA and depending on location and amenities we see rates up to $15/sf NNN", "replies": [{"id": "ir3pbxj", "text": "is this a recent / new phenomenon?", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}, {"id": "iqzs5wn", "text": "In our area, they are about 60% plumbers/electricians/etc and 40% hobbyists (guys with too many cars/Toys at home, hobby woodworkers, etc). \n\nThere seems to me an endless supply of renters- the few that are local to me have 36+ month wait lists currently.\n\nDisadvantage is that they rent for ~$10/sq ft/yearly\n\nAdvantage; cheap to build and maintain;  110 electric is the only amenity.  No bath rooms, no plumbing, no insulation, nothing except overhead light abs some wall sockets.", "replies": [{"id": "iqzvmhv", "text": "Hobbyists? Wouldn't it be cheaper to get a storage unit?", "replies": [{"id": "iqzw5q9", "text": "That\u2019s basically what these are, but typically the largest normal storage units are 10x20, whereas these range up to 20x40.  \n\nLikewise, these aren\u2019t your typical hobbyists.  They generally seem to be borderline wealthy, and often the decision seems to be between buying another house with room for a shop, or buying a commercial property to use as a man cave\u2026 this is an inexpensive alternative to either.  Most of these guys don\u2019t much care about cheap.", "replies": [{"id": "ircpa3s", "text": "What is a typical range for construction costs (ppsf) for these garages in your area?", "replies": [{"id": "ircs6i6", "text": "I do not know.  Here\u2019s the website of one local to me https://affordablestoragesanangelo.com/6566-s-hwy-67/\n\nThere are quite a few pics to get an idea.   I can\u2019t see it being terribly expensive; land, foundation (likely the most expensive part.  8\u201d thick, rebar reinforced and tied concrete driveways for commercial venues run about $10/sq ft and here.  Red iron buildings run approx $12-15/sq ft.  Then there\u2019s electric -super basic service is all that\u2019s necessary, and they put 2 sets of bathrooms for the entire storage unit business.   \n\nMy guess is they can build out, from concrete to door locks, for less than $50/sq ft.   \n\nThese are becoming more and more common around the country.  I\u2019ve seen a bunch pop up in the last several years.", "replies": [], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "iqx7tfw", "text": "I worked on a deal where an ATM machine was allocated 100sf but paid $120 PSF in an NYC borough.", "replies": [], "depth": 1}, {"id": "iqxpxdl", "text": "Anchor tenants can add $2/sf/yr to $5/sf/yr to the inline bays.", "replies": [{"id": "iqzc1j5", "text": "What do you mean add to inline bays are you sayings with having an anchor tenant vs not having an anchor tenant difference?", "replies": [{"id": "iqzea7f", "text": "\u201cMiddle\u201d spaces", "replies": [], "depth": 3}, {"id": "iqzj1th", "text": "Inline retail in an anchored center rents for a premium over an unanchored center.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}]