INSIGHTS INTO THE WORLD OF SIMONCRE AND THE INDUSTRY WE LOVE

news & views

A SimonCRE RECap of ICSC RECon

With another ICSC RECon in the books, there was a lot of talk about the changing retail landscape. Much of the focus was on the use of technology and omni-channel approaches, the winners and losers in the retail sector, and what companies have to do to stay competitive in today's market. Here's what some of the biggest buzz was about at ICSC RECon 2017.

ICSC-Takeaways1.png

 

So what did the SimonCRE crew think of this year's conference? Let's hear from them. 

SimonCRE Weighs in On RECon 2017

 

Josh-Simon.jpgJoshua Simon

The biggest talking points from this year’s ICSC revolve around the idea of omni-channel as well as experiential retail and how that’s shaking up the industry. Consumer behavior is changing. People are spending more money on experiences on all retail fronts. If companies aren’t meeting that consumer demand or implementing technology, they’re going to go the way of many of these struggling big box retailers.

A lot of talk is also about which sectors are thriving; sectors like food, fitness, and discount retailers, because they’re positioning themselves as “Amazon-proof”, or capable of handling the threat of e-commerce. So, these concepts are grabbing a lot of attention and seeing a lot of activity in today’s market.

 

Jeff-Carpenter.jpgJeff Carpenter

The most talked about topics involved the shakeout of some weaker, less adaptive retailers and how real estate owners are going to deal with that space. In particularly, big box retailers have been closing stores and leaving huge vacancies at malls and power centers.

We also heard a lot of discussion on what’s going to happen to cap rates in the coming months. We’re seeing a slight uptick in rates, but we’ll have to see if that trend continues.   

I think overall, a lot of commercial real estate companies are staying busy, despite some of the uneasiness around the retail sector. Activity in the industry seems to be trending up.

 

Blake-Curtis.jpgBlake Curtis

The demand for net-lease retail investment product remains strong. Net-lease transactions are steadily increasing as a share of total annual investment. There is a continued demand for long term leases.

There’s also some mixed sentiment surrounding retail as an asset class (specifically Class B &C shopping  centers), many of the large big-box national retailers reported poor earnings in Q1 however, the disruption / consolidation has created “winners & losers.” This doesn’t mean retail is becoming obsolete, rather this is a transformative period for the retail sector. Those that can reinvent themselves will prosper.

My big takeaway is that I’m still optimistic we will see net lease tenant concepts expand / prosper; investor demand will remain strong. Sure, there is disruption within the retail sector, however, there is a common misconception that retail will become obsolete over the course of the next 3,5,10 years. But the store closures that are making headlines are not materially impacting the sector as a whole.

 

Tags: Events Retail Trends Consumer Trends

Stay up to date on the latest in commercial real estate with Simon SumUp
Recent Projects
Elimination of Section 1031 and the risks to CRE and the economy

Follow Us

Follow SimonCRE on Facebook Follow SimonCRE on Twitter Follow SimonCRE on LinkedIn Follow SimonCRE on Google+

Subscribe for updates

Popular Posts