Within the last few years of working in the commercial real estate industry, I’ve grown accustomed to the blank stare and lack of follow up questions when talking to friends and family (aka the consumer) about my job, the current events in my industry, and my daily “deal dramas”. It’s certainly not because of a lack of intelligence, but it’s hard to be genuinely interested or ask the appropriate follow up question when you don’t think you understand an industry you don’t work in. My friends’ and family’s jobs range from teachers, marketing directors, event planners to investment bankers, so while some may understand certain aspects, what they don’t realize is how often they feed me valuable market knowledge.
So what better way to get their attention than to write about ways they unintentionally help me in my job? Here are five insightful ways they’ve helped me keep up with the CRE retail market: 1. The Weekly “hot spot” 25 Degrees in River North
Whether it’s for dinner, an after-work drink or Saturday brunch, my friends and I are always looking for the latest trendy venue for our weekly meet up. Most of the time, it’s one of my non-CRE retail friends that is the most knowledgeable about these “hot spots”.
New retailers, whether it’s a specialty donut shop (have you been to Stan’s
on Damen?) or a Lettuce Entertain you concept, are aggressively sought out by CRE people. Tenant Rep guys chase these tenants for expansion, while product leasing reps stay on top of new users to increase occupancy rates.
Speaking of trendy venues, here are a few of my favorite spots in the city! Ada Street 25 Degrees Wilde Bar & Restaurant Summer House Santa Monica 2. “Which neighborhood do you live in?” Fjallraven in Bucktown
If you live in Chicago, you’ve had the neighborhood conversation countless times. Do you prefer the nightlife and restaurant scene in River North? Or the boutiques and cozy cafes of Roscoe Village? With most apartment leases rolling after a year, discussions on where my friends want to live happen frequently and are based on a lot of the same factors that determine the success of a retailer or shopping center. The one thing most people DO know about real estate is location, location, location. Everyone wants to be able to have convenient access to retail: Is there ample parking available? Does your Starbucks have a drive-thru?
Demographics, accessibility, visibility and occupancy costs are all factors that determine a tenant’s location and success, as well as plays a large role in determining the saleability and cap rate of an investment sale.
With Bucktown and Wicker Park being two of the most up and coming neighborhoods in Chicago, I figured I’d share a few of the retailers in these neighborhoods below: Fjallraven Shinola Big Star The Violet Hour 3. The Bricks and Mortar vs. E-Commerce debate Topshop on North Michigan Avenue
Online shopping, whether it’s buying an e-book on your kindle or buying clothes off Shopbop
, has been a major “threat” to the bricks and mortar business over the last few years and continues to be seen as one for the future. Debating the convenience of being able to purchase items online versus being able to go and physically try on clothing, shoes, etc. is also a common topic amongst my friends. However, I always fight for the bricks and mortar – unless of course the online site has free return shipping :) KIDDING!
In the future I think the retail industry will eventually strike a healthy balance between online presence and bricks and mortar. As many of the once e-commerce only companies begin to open physical stores (Amazon
, Rent the Runway
, Birch Box
, Bauble Bar
, etc.), it’s clear that bricks and mortar will continue to play an integral role in retail. 4. Did you “follow”, “like” or “tag” them? ICSC Twitter
Social Media – in today’s age, every movement by family and friends is uploaded or posted to some form of social media. Besides sharing every aspect of their life, my friends also “follow” their favorite designer, fitness studio, grocer or home goods store to see the latest sales, styles and news.
This has become one of the most dynamic marketing platforms over the last few years in addition to being a very accessible and popular news source. I often turn to Twitter to find hourly updates or links to the latest news articles in the CRE industry. ICSC Twitter Mid-America Real Estate Group Facebook Wall Street Journal 5. Whole Foods, Mariano’s or Trader Joe’s? Trader Joe's at Shops of Uptown in Park Ridge
Whether you do all of the grocery shopping in your family or not, you’ve likely discussed grocery preferences. I hear my mom and my friends talk about their grocery shopping preferences regularly. Opinions over the variety of produce a grocer has, selection of prepared meals and prices are abundant.
Grocery anchored centers have been one of the hottest topics in the retail CRE world. Especially in Chicago, we have experienced a lot of change with new grocers entering the market and new market leaders emerging. In the investment sales world we are seeing Mariano’s and Whole Foods anchored centers being traded at cap rates that are even 50-75 bps lower than what they would have between 2004-2007.
If you haven’t tried a Mariano’s juice smoothie
or a Whole Foods prepared veggie burger
, you’re missing out.
Carly Gallagher | Investment Broker
Mid-America Real Estate Corporation
One Parkview Plaza, 9th Floor | Oakbrook Terrace, IL 60181
Direct: 630.261.6944 | Fax: 630.954.7304
firstname.lastname@example.org | www.midamericagrp.com