Physical retail isn’t dying, but retail as we know it is shifting beneath our feet. While it’s true that some retailers are closing locations due to the “Retail Apocalypse”, many online-only retailers are moving into their first physical store locations. These brands are capitalizing on the recent closures of some traditional retailers, creating new opportunities to expand and improve their businesses.

Despite news reports that major retailers such as Toys “R” Us, Sports Authority, and Sears have filed for bankruptcy and shuttered stores nationwide, retail continues to flourish.  As a matter of fact, the National Retail Federation reports that for every store that closed in 2018 in the U.S. another 2.7 stores opened.  Shifts in the industry have created a greater opportunity for online-only retailers to move into their first physical locations. Simultaneously, established brick-and-mortar retailers are keeping relevant by collaborating with digital brands to increase traffic and reshape the retail experience.

For example, national retailer Kohl’s is demonstrating this innovative approach flawlessly by introducing “Curated by Kohl’s”. In 2020, Kohl’s will partner with Facebook on brand curation, identifying and engaging with brands that have built a strong online presence and allowing them the opportunity to reap the benefits of the retail experience. Customers, too, will benefit as they discover emerging brands when shopping.

Mattress retailer Casper is yet another online brand that has embraced the brick-and-mortar environment. It wisely capitalized on the announcement that Mattress Firm, one of its major competitors, was filing for bankruptcy and closing more than 500 stores. Taking advantage of an opportunity to reach even more customers, Casper launched its first retail store in New York City and is planning to open more than 200 locations in the next three years.

For retailers to be successful, in-person experiences must be so engaging and memorable that they effectively compete with the convenience of online shopping. Casper does this by offering pop-up shops where customers can test its products by taking a nap for $25 a session. Casper’s efforts demonstrate how next-generation retailers are leaning into immersive, in-person shopping experiences.

Warby Parker, which sells prescription glasses and sunglasses, is another online brand that continues to thrive since opening its brick-and-mortar stores. Customer demand to try on glasses before making a purchase drove the retailer to invest in physical shops. These shops have given Warby Parker even greater exposure and the opportunity to improve their business as demand for their products has increased.

Retail is undergoing a transformative period in its long history, and the future looks bright as more online retailers move into brick-and-mortar stores. Retail centers that embrace online brands as tenants can feel optimistic that they will benefit from increased foot traffic and a fresh look.

What online retailers are you seeing move into brick-and-mortar stores? Do you consider this a passing fad or a long-term trend?

CPD is saddened to share the news that our founder, Mike Folio, has passed away.  Mike, a talented, innovative and driven real estate veteran, was admired and respected by colleagues and competitors alike.

Mike’s impressive career began as the Director of Real Estate at Grand Union Supermarkets New York region. He later held positions as Assistant Vice President for First Capital Financial Corporation, Partner and Vice President of Real Estate Development at Lewis Property Investors, and Vice President and Senior Vice President of Real Estate at The Home Depot.  During his 13-year tenure at The Home Depot, Mike was instrumental in the development of over 1,600 new stores. Subsequently, Mike founded CPD, one of the first companies in the industry to focus on the disposition of real estate assets and led the business until his retirement.

During the past several years, Mike battled Alzheimer’s disease. Together, he and his wife, Cheryl brought greater visibility to how to live the best possible life after receiving this terrible diagnosis.  Michael and Cheryl published a book titled “The 24-Hour Rule” that highlighted the methods they used to allow them to live a meaningful life together while continuing to adjust to his “new normal”.  They were greatly helped by their two emotional support animals, Oliver and Baxter, and strengthened by the love of their family. Mike leaves behind his devoted wife Cheryl, three daughters, Laura, Brielle and Tara, and his stepchildren Jared and Samantha Levin.

Mike and Cheryl were committed to finding a cure for Alzheimer’s disease and participated in numerous fundraisers and races.  In memory of Mike, CPD is actively supporting the  Alzheimer’s Foundation, a nonprofit organization devoted to researching this disease and supporting the families affected.  You can find information about the foundation and the disease at: http://act.alz.org/goto/LevinFolio

 

Welcome to a fresh new take on CPD’s blog!  Here we will share valuable information about the real estate industry – everything from the latest trends and reports to case studies, interviews, helpful tips for property owners and more.

Since the real estate world has its own unique terminology, we thought it would be helpful to share a series of posts that define unfamiliar industry words and phrases.  First up on our list is a term that is not only a part of our CPD name, but part of our everyday world…that is, dispositions, also known as divestments.

One of Merriam–Webster’s definitions of disposition is “the act or the power of disposing or the state of being disposed,” such as in the transferring to the care or possession of another.   The definition of divest is “to deprive or dispossess especially of property, authority, or title; ex. divesting assets to raise capital.” Both of these definitions can be confusing in relation to commercial real estate, but the overall concept is that when you dispose of a property, you transfer the ownership or care of it to another person or entity.  It involves the act of selling or leasing a property, but it’s not always that simple.

Inevitably, one question comes to mind: What is the difference between a property that is considered a disposition and another property that is being sold?  Frankly, there is not much difference in the property itself. Rather, the difference lies in how the owner views the property.  Typically, dispositions/divestments are properties that owners or tenants want to sell off or lease from their property portfolio because they no longer meet a specific need.  Dispositions are a subsection of asset management that is a more specialized practice area, focusing on these distinct properties.

CPD has extensive experience in this arena. We can manage the sale or leasing of all or a portion of a company’s real property portfolio that is deemed as surplus.  Do any of your properties fall into this category?  If yes, CPD can evaluate your property and strategize next steps with you.

Are you curious about other commercial real estate terms?  Please feel free to share these terms below, and you may just see an explanation of them on an upcoming blog post.