Determining Optimal Tenant Mix in Shopping Centers regarding Inter-Store Externalites (Case Study: Isfahan City Center)

Developing shopping centers in cities have made developer pay precisely attention to what is called optimal tenant mix. Proximities of similar and divers stores make shopping centers attractive and decrease costs for costumers. The benefits derived from these proximities is inter-store externalities. The purpose of this paper is determining optimal tenant mix for Isfahan City Center in period between December 2017 to March 2018. A pure-integer linear programming model in which total benefits of developer including the inter-store externalities is maximized has been used. Seven types of retails include jewelry, cosmetics, fashion, home appliances, furniture and interior decoration, food & beverage and café in tree size classes and tree location classes are considered. Comparing the optimum results with the real ones, show that the most compatible retails with the optimum mixture are jewelry, home appliances and furniture and interior decoration. In general the results show a more concentrative optimal solution than what is real mixture of retails. One of the reasons behind this outcome is because the inter-store externalities from diversity is not considered in the model.