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Bad News for Urban Retail Real Estate

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Simon Hersom
Simon Hersom  
11/29/2012 12:37:57 PM
User Rank Urban Legend
Re: Changing Face of Retail
I watched the whole video - aided by having to be at home to recover from a surgeon's attention - and he's got at least half of it.  The other half is the bit we don't know about yet.

Rather than making stock and then having to shift it someone's going to start making it all to order, quickly and efficiently.  We already know that the best shopping centres are destinations or tourist attractions.  The rest are convenience stores, niche - or empty.  Not a message most of the real estate investment community has wanted to hear.

There's always stuff you want to choose in person whether it's a ball gown or a cauliflower.  If that shopping experience is fun rather than a drudge you'll buy other stuff too.  But for half the stuff i buy now - probably quite a bit more - it works better online.  But there's a catch.  I work from home a lot and my wife also.  Our neighbours do the same and we are gated and CCTVd so delivery is very simple to Chateau Hersom.

Most people need a secure convenient delivery point that's open 24/7 for collections or timed deliveries day and night.  While some stores do collections it's only for their own goods and a tour of the neighbourhood at midnight collecting several articles from different places is unappealing.  It's coming, it''s got to be.

Hazel
Hazel  
11/26/2012 1:24:26 AM
User Rank Urban Legend
Re: Changing Face of Retail
There's going to be a huge shift because of these expected changes. Clerks might soon find themselves jobless as people go online instead of into the brick and mortar stores. The rumor you mentioned might also become true: the physical stores might instead be turned into showrooms of items that can only be purchased online.

Retailers have to adapt to what's happening to make sure that they or their brand doesn't die out. Evolve. Add online shopping stations in store. Make renovations and offer both online and offline shopping service. The real estate can be converted. It will require time and resources but it can be done.

Resurgent phoenix
Resurgent phoenix  
11/24/2012 5:39:56 PM
User Rank City Slicker
Disney Predicted this at Epcot decades ago
Decades ago I visited Epcot Center when it was first built in Orlando , Fla, U.S.A.   As you rode through the ride you saw people buying items from clothes to groceries and having them delievered to there house.  Do you think it may be possible that one day everyone will have a printer that prints out products in their home and have the disc with a program on it to print out the desired product.  I actually saw that in some Sci-Fi movie and it looks like the technology is here, it is just currently expensive , but that can change.

tbulone
tbulone  
11/24/2012 6:01:40 AM
User Rank Urban Legend
Changing Face of Retail
"In fact, many experts believe the figure is heading rapidly towards 25 percent -- a number that would likely make 20 percent of retail property in the UK obsolete."

These numbers seem incredibly low.  I can easily foresee Internet retailing account for 50 percent of retail sales within 10 years, and bottoming out at around 70 percent within 20 years.  This is going to make a whole lot more retail property nothing but empty space.

The traditional brick and mortar store is going to have to change to accept this reality.  When people take the time to go to a store in the future, it won't be for the convenience - they will want to connect to it somehow on a personal level, and supersized stores don't enable that to happen.  For the most part, more and more people will be going to the store for the experience - whether it's to be pampered, find a truly unique specialty item, get ideas, or get some help.  Consequently, I don't believe stores will have to be bigger.  Rather, I think stores will need to be smaller - a lot smaller.  There are many people out there, myself included, who can't stand the thought of wasting gas and time going to a mega store, finding parking, dealing with indifferent store staff that knows almost nothing about the stuff they sell, (that is if you can even find store staff), and spending half a day attempting to locate whatever it is they wish to buy.  Apple stores seem to have it right - the right combination of products, size, atmosphere, layout, and smart staff.

piratejulie
piratejulie  
11/22/2012 5:52:24 PM
User Rank Urban Legend
Activated Audience
Tercek speaks of an "activated audience."  He goes on to say there is "re-programming" going on [where this "activated audience" is present].  His use of language is compelling as it strikes me as different from this fundamental dynamic:  Retailers have long been active in re-programming consumers.  Beginning with Y2K.  Amnesia?  Many tech folks I was in proximity to [during the days of Y2K] joked how the whole thing was Marketing to the Internet Generation!  

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