The rise of multi-channel retailing is creating opportunities for retail and industrial real estate, a CBRE report reveals.
“The Future Impact of E -commerce on Industrial and Retail Real Estate” report found multi-channel strategies will create new opportunities for retailers, such as programs that allow consumers to purchase a product online and pick it up at their convenience at a locker in a local store. Additionally, popular same-day home delivery strategies will likely require that future distribution centres be proximate to consumers, which should create increased opportunities for urban in-fill development.
“The challenges facing retail real estate markets due to the rapid changes taking place in how and where consumers shop goods are well known but there are also substantial opportunities in this evolving environment,” said David Egan, director, research & analysis, CBRE.
The report also found the market for urban high-street retail remains robust as prime retail rents. This can be partially explained by the fact that high-street retail offers shopping-as-entertainment and non-commoditised products.
Also, Retailers, particularly apparel chain stores, continue to combat the trend of consumers treating a store as a “show room” for products that may ultimately be purchased online. As consumers are provided more purchasing options online, stores engaged in core e-commerce sectors are now more vulnerable to lower profit margins, likely translating to lower rents for strip and power centres that cater to these types of tenants.