The best retailers aren’t just surviving, they’re thriving.
But what makes the difference? How do you know you’re making the right decision when you invest in a tenant in your center? This week Rachel was a guest on podcast Where We Buy with James Cook of JLL, where they discussed retailers that are getting it right and when retailers should own their real estate. Listen here.
Given all the talk of Retail Apocalypse (don’t worry dad, I’ll be fine), we gave our two cents on Amazon’s new brick and mortar concepts to SCT Magazine, see excerpt below.
WeinPlus serves as the principal strategic advisor for industry leading public and private real estate owners, a top-tier grocery retailer as well as several boutique real estate firms nationwide. Give us a call to discuss your needs at 727.386.9346.
Amazon’s innovations tend to attract plenty of attention. But how seriously should retailers and developers take the likes of Amazon’s Prime Air drone-delivery program, or its Go store, which uses advanced tech to let shoppers grab stuff off the shelf and leave, no checkout required? The shopping center industry clearly has need to invest in new technologies and respond to change, says Rachel Elias Wein, president of WeinPlus, a real estate consulting firm. But Amazon’s spending famously outstrips its revenue growth, Wein points out, and such an approach would hardly be a fit for traditional grocers, retailers or developers, particularly those beholden to Wall Street. “Jeff Bezos [Amazon’s founder] thinks about new concepts differently,” Wein said. “Where many people choose an idea based on its likelihood of success, he makes his bets based on how big it could be if it were successful. It is an entirely different calculus.”
That is different, to be sure, and it is expensive to boot: in 2016 Amazon ramped up its capital expenditures to some $6.7 billion, up by 46 percent over the previous year. While the company has scored hits with moneymaking businesses like Prime and Amazon Web Services, Wein notes, the relevant question for retail real estate is whether any Amazon experiments that affect real estate will truly catch on. “Amazon Go, AmazonFresh, Amazon [Prime] Now — all of these new attempts may or may not work,” she said. “But if any one of them takes off, it will be hugely impactful to retail.” With sensors, cameras and machine intelligence borrowed from the development of driverless cars, the Amazon Go initiative is likely to remain small-scale for now, Wein says. “Does Amazon Go make sense? Do we want to go shopping where we can’t find someone to ask for help? I’m not sure,” she said. “For the time being, the approach at Go is likely far too expensive to be profitable.”
It’s not all doom and gloom. Here are 22 retailers that are expanding now.
Impressed by Walmart’s e-tail moves following the acquisition of Modcloth, Jet.com and maybe even Bonobos? Now Jet.com has opened a temporary brick-and-mortar grocery location in New York, in partnership with retail storefront Story. The store sells fresh ingredients and culinary items.
Throwback Thursday: here’s a look back at Amazon’s Annual Letter from 1997 — when their share price was $18. [bangs head on desk repeatedly].
VIDEO: CRE Trendspotting. If you missed it live (or just can’t get enough), here’s our take on the CRE impacts of The Sharing Economy, Automotive Disruption, and Customer Experience.
More than half of online shoppers haven’t tried BOPIS and only 31.6% of those that have used it describe a “smooth” process vs. 66% that describe online shopping that way.
We bid farewell and best wishes to Mindy Grossman of HSNi as she moves to the CEO role at Weight Watchers.
Congratulations to Jeff Mooallem on his move to lead newly-formed Gazit Horizons.