Important Developments on Real Estate Retail in Rockford IL
As these trends evolve before our eyes, retailers of all stripes are being forced to adapt their business models or find another line of work. Savvy commercial real estate investors are responding by repurposing warehouses, vacant land and existing retail spaces to conform with new industry dynamics. And while zombie malls and large-scale mixed-use development projects dominate the headlines, individual investors and niche players can profit just like the big guys.
Here are five emerging trends in the real estate retail in Rockford IL, and corresponding commercial real estate investment strategies to stay ahead of the curve.
1) Age of Experience
With virtually any product on earth now just a click away, retailers must lure customers into physical stores with engagement and entertainment. In the words of one REIT analyst, Mall tendency has changed. What hasn’t changed is the human desire to socialize. From well-worn brands, successful stores now imprint an experience and positive association with a brand.
If full-scale renovation is out of your budget, consider a non-traditional tenant for a traditional space. The owners created a gathering place for local craftsmen and women, complete with workshops and an incubator-like maker space. Creative businesses like these can often pay more rent than traditional industrial tenants, and they are likely to make improvements to an owner’s building which add value even after the tenant leaves.
2) Health and Wellness Boom
Even if investors of real estate retail in Rockford IL can’t profit from app sales, there are ways to play the health and wellness boom with sticks and bricks. Fitness tenants like yoga studios and gyms often fit multiple zoning categories and require minimal owner-paid buildouts. Focus on upscale retail districts with good access (public transportation, walkability or ample parking) and screen tenants to ensure the operator has a track record of success.
3) Transportation Revolution
Even though they haven’t figured out how to turn a profit doing it, companies have upended the way people get around. Developers and cities are scrambling to reshuffle parking ratios, and we are even hearing fresh rumblings from those intrepid tinkerers trying to commercialize flying cars.
Few investors of real estate retail in Rockford IL realize that one option for playing this burgeoning trend is to go long parking. This may sound counterintuitive since Uber is killing the parking business. True, parking for restaurants, night clubs and hotels isn’t exactly a growth business, but shuttle operators, scooter companies and even car-sharing titans have acute parking needs for their fleets. This demand is most ideally met close to population centers, while still being far enough from the urban core to find affordable rents.
4) Shifting Urban Food Dynamics
Speaking of unprofitable businesses changing the way urban-dwelling Americans live, companies are radically transforming food consumption patterns. And thanks to high rents, soaring labor costs and competition from delivery services, food purveyors are looking for ways to sell their food beyond the typically dine-in restaurant.
5) The New “Click and Mortar”
Casually drop the Halo Effect at your next cocktail party, then pause for effect. Referring to the impact brick-and-mortar stores have on a brand’s web traffic, real estate retail in Rockford IL are learning that physical locations can actually boost online sales. Internet-first, brick-and-mortar-second brands, where customers can experience products in a physical space, make immediate online purchases then walk out empty-handed.