Oct. 20--After more than three decades, Function Junction left the Country Club Plaza this year, saying traffic and sales had dropped and the landlord wouldn't adjust the rent accordingly.

Then toy store Zoom, a longtime tenant of Crown Center, jumped into Function Junction's former space, calling the Plaza the "best and most exciting shopping center in the metro area."

In Leawood, Town Center Plaza's Dean & DeLuca ogled One Nineteen -- a spanking new shopping center across the street where the sales seemed a little greener. One Nineteen even built a 15,000-square-foot freestanding building with a drive-through just for the gourmet food shop. Then the recession arrived and Dean & DeLuca decided to stay put, which led to One Nineteen's landlord filing a lawsuit.

All over the metro, restaurants and retailers are making moves (or thinking about it) as shopping centers scramble to fill dark spaces. Business owners may see a new location as a way to increase revenues in this recession. Or maybe they had extravagant expansion plans before the economic downturn and now are regrouping.

Call it a retail version of musical chairs. Every time the action stops, there seems to be even more empty spaces from which to choose.

Plaza landlord Highwoods Properties had no comment on its tenants' comings and goings, but Zoom is clearly happier in its new spot.

"I think every mall in the country is probably looking for a tenant," said John Middelkamp, owner of Zoom. "The economy clearly brought about concessions on the Plaza as it would from any mall developer. But the square footage was just what we were looking for, we have great visibility here, and we are so much more convenient for the local customers."

In recent years, smaller mom-and-pop operations had little chance of snagging a coveted shopping center spot, let alone a choice one.

Instead, national operators were the sought-after tenants because of their track record of sustaining rents and customer service and their built-in following. The chain operations kept coming, expanding to keep out competitors and please shareholders.

Not any longer.

A new study by real estate researchers Reis Inc. found that shopping center vacancies rose in the third quarter to a 17-year high as unemployment climbed, consumers cut spending and stores closed. Vacancies at neighborhood and community shopping centers increased to 10.3 percent -- the highest level since 1992 -- compared with 8.4 percent in 2008. Vacancies at regional and super-regional malls rose to 8.6 percent from 6.6 percent a year earlier, a high for this decade.

Rents also have dropped, to $39.18 on average at regional and super-regional malls from $40.62 a square foot a year earlier. The 3.5 percent decline is the worst year-over-year deterioration in a decade, Reis said.

"Until we see stabilization and recovery take root in both consumer spending and business spending and hiring, we do not foresee a recovery in the retail sector until late 2012 at the earliest," Victor Calanog, Reis' research director, said in a statement.

To fill spaces, landlords are looking at nontraditional tenants such as grocery stores, discounters, office tenants and, yes, mom-and-pop operations.

Mom-and-pops not only are being considered but often are in positions of power and able to ask for better terms -- cheaper rents, funds for tenant finish, concessions if occupancy continues to drop, and shorter leases.

Indeed, the willingness to negotiate may be in direct proportion to a center's rate of vacancies.

"Any time you have an empty space, it is a negative," said Dave Claflin, spokesman for RED Development, which manages several area centers, including the Legends at Village West and One Nineteen. "So in this economy, everyone has gotten less choosy and more willing to take risks."

Still, RED looks at financials and reputation. It seeks tenants that will bring "vibrancy" to its centers, that will complement other tenants and that will not be so similar to other shops that they cannibalize sales.

Sometimes it's hit or miss.

New restaurant/retail/salon concept Deegie's Carma closed after only about five months of operation at the Legends in Kansas City, Kan., but a more upscale sister concept, Soho 119, has been operating for a year now at Leawood's One Nineteen.

"We took some people with great backgrounds, pedigrees, but who had not done this concept before," Claflin said. "Maybe they needed more flexibility to form the concept, but ideally you do the research and development on someone else's nickel. When you are looking at a local retailer, particularly with a new concept, you don't have the benefit of looking at a past record, so you have to be willing to take a few more risks."

Stores such as Zoom relocate for a variety of reasons -- better visibility and access, more space, more foot traffic, better rent, to follow a favorite landlord, or maybe even to keep a competitor from getting a better space.

But experts advise owners to explore key questions such as how the new market varies from the old one.

"Don't just assume sales will come because it is a better location with more visibility and more cars," said Elisa Waldman, a consultant with the Kansas Small Business Development Center at Johnson County Community College. "You have to pay for the move. And then, if you do nothing other than move, there may be as much as a 20 percent decrease in revenue. But you can easily blast past that 20 percent with aggressive marketing and hopefully never feel that."

Customers can be clued on the move via e-mail blasts, newsletters, ads, a moving sale at the current location and a grand opening sale at the new store.

"They need to be smart about who they are trying to reach, how they are trying to reach them and what they need to hear," said Lee Page, vice president of Sturges Word Communications Inc. "It's not just a Facebook page, it's not just one ad, it's not just a direct mail piece. A business needs to look at them all and how they fit with their target market."

Relocating businesses also can leverage relationships with the new landlord, chambers of commerce, charitable organizations and professional membership groups to spread the word.

"I shake my head all the time at people who think they can build it and they will come," Page said.

Zoom wasn't one of those.

While at Crown Center, it dropped fliers into shopping bags to inform customers of the move. It set out to draw new customers with ads in area magazines targeting mothers. Since the move, it has included the words "now on the Country Club Plaza" in print ads.

"We got tons of kids in at Crown Center from field trips to Union Station or the Coterie (Theatre), and free activities -- of which they thought the store was part of the free entertainment," Middelkamp said. "Here we have less walk-in traffic, but our average ticket is up 25 percent."

Retail experts note that great opportunity can be found in this recessionary market, but so can risks.

"In this day and time, just because retailers/restaurants do well in one location doesn't mean they will in another. The flavor of that location doesn't always go with them," said Robert Mayer, executive-in-residence at Park University's business school.

Find out why the previous tenant closed. Was it a problem with the business? The location? The landlord?

"Leases are written to be landlord-friendly, but an attorney can balance out the equity by adding in tenant-friendly clauses and opportunities," said Waldman of the Kansas Small Business Development Center.

A good commercial broker also will have the inside scoop on a project or developer while filling in the prospective tenant on area demographics -- how many employees are in the neighborhood for day business, the number of cars passing by each day, if the rent is "average, high or low" based on projected sales, the history of the shopping center and history of the locations around the center.

Larry Gaines, commercial sales and food and beverage specialist with Block & Co. Inc., represents several "second-generation" restaurant spots, which allow for substantial savings on startup costs.

"If you know your business well, then there are a lot of values in leasing real estate or even in purchasing," Gaines said. "Everyone is hungry to make a deal."

Take the former Cheeseburger in Paradise spot in Leawood, now home to Tannahs restaurant.

Tannahs' owners, Nathan and Mendy Tannahill, originally signed on to Olathe Pointe when it was nothing more than a plowed field with plans to be Olathe's trendy upscale center. But after they opened the restaurant in late 2006, the Tannahills said, the center shifted a bit to discounters, which wasn't a good fit with their more upscale concept.

So when occupancy fell below a certain point, they said, they were able to void the lease. Gaines and another broker helped them relocate to the Leawood space, where sales have doubled since the late April opening.

Although rent is less per square foot, the Tannahills did spend 13 weeks replacing the beach motif with a more contemporary decor. Luckily, most of their employees took part-time jobs during the down time and rejoined them when the restaurant reopened.

"It always takes longer and costs more than the contractor says, and you can quote me," Tannahill said.

That's why Steve Schussler, founder of the Legends' T-Rex, prefers to start from scratch, as he is doing with his latest concept, Backfire BBQ: Featuring Orange County Choppers, opening in December in the Legends.

"If you take over another restaurant space, it cheapens your brand and creates confusion," Schussler said. "People recognize elements from the previous tenant -- from the shape of the roof to the size of your bar stools. It's the death of a new brand more often than not."

Just as the landlords should be doing their due diligence on tenants, tenants shouldn't hesitate to do the same with the landlords.

Mary Merola, founder and owner of Function Junction, which is now expanding in Crown Center, asks the landlords for references.

"If tenants are leaving or landlords are filing lawsuits against their tenants, what does that tell you?" she said. "They are certainly reacting differently in fall of 2009 then they did in winter of 2008. You want a landlord that will do what's right, do what they have to. Ultimately it is two parties making good business decisions."

Retailers and restaurants contemplating a move should craft a business plan that answers key questions, including:

--How does the new market vary from the old one? Check the area demographics to determine whether it fits your target market.

--What are the benefits of the new location?

--Who are your main customers, and will that shift if you move? Are your customers convenience-oriented or destination-driven?

--What makes your concept different or appealing? Is your business a strong draw and unique enough that customers will drive a distance?

--Will your product mix have to change?

--How will cash flow differ?

--What are the consequences if you have to break your current lease?

--How much money will you need to move, to remodel the new space or to make any other changes?

--How will you inform my existing and new customers of the move?

Specific to the lease --What are the common area maintenance fees? Promotional fees?

--Is this space compliant with the American with Disabilities Act? What changes might have to be made to meet local regulations?

--What if the business outgrows its space before the lease expires? Can it be subleased?

--Is rent payable while the space is finished before opening?

Bloomberg News contributed to this report.

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