Industry insights, market outlook reports and commercial real estate
news, and trends from the Coldwell
Banker Commercial brand.
By now, everyone has had a chance to digest the impact of Amazon’s purchase of Whole Foods and the introduction of their AmazonGo and AmazonFresh grocery innovations. Yet Amazon’s effect on CRE goes beyond these changes.
As the future of transportation and city development changes rapidly, developers are reevaluating the demand for parking in retail, office, and multi-tenant spaces. The lack of ample parking has been a reality for people living and working in densely populated areas like San Francisco and New York City.
Retail trends have greatly impacted the industrial market for the last few years. Amazon shifted the entire e-commerce industry to lightning-fast shipping, which means that industrial centers and warehouses are being moved to closer-to-the-city locations to handle the load.
Last year, core assets were ranked second highest among investors. This year, secondary metros took that spot. Some argue that the cap rates for core assets and investors looking for assets that produce higher yields are why secondary markets look so much more attractive to investors this year.
Retail sentiment is shifting dramatically. Many analysts point to the nearly 10% decline in brick-and-mortar retail since last year as a signal that retail sentiment is down. However, the numbers say consumers are spending and optimistic, while industrial replaced core assets as the second highest-producing markets over the last year.
There is truth to the belief that there’s a Starbucks on almost every corner. A recent study shows that there are almost four stores per one square mile. With the ubiquity of Starbucks, it is hard to imagine that the company might have reached a saturation point, but it seems that it has come to that point.
The commercial real estate sector has been seeing a lot of changes over the past several years, and the industry has had to figure out how to work through these changes. From grocery delivery services to consumers looking for more options, the grocery sector has some of the most significant changes.
Has the in-store experience given way to the online shopping craze? Not quite yet, according to the experts at Coldwell Banker Commercial Affiliates. The Omnichannel Retail and Commercial Real Estate Survey of November 2016 finds that brick and mortar have yet to roll over and play dead.
With the market changing over time, retailers in the grocery and apparel sectors must constantly rejigger their techniques to stay relevant. Let’s break down the facts so that you have a better chance of coming out on top when the competition gets tight.
Sam Zell recently stated: “The real estate cycle is nearing its end” (Pensions & Investments, May 1, 2017). We must admit that Sam had great timing when he sold his Equity Office REIT to Blackstone in 2007 which was the peak of the last cycle.