Retailers and investors are quickly pivoting based on consumer changes, with retailers redefining the use of their space, size and experiences, says Anjee Solanki, national retail director for the U.S. for Colliers, as reported by GlobeSt.com. Forty-nine percent of retailers plan to expand their footprint over the next five years versus 28.5% looking to reduce space, according to Colliers’ Fall 2023 Retail Report.
“Pickleball is the new frontier in commercial real estate. The rapid growth of the sport is similar to what tennis did in the 1970s and 1980s. Landlords love it because it brings more foot traffic from people with spending power. And it’s also good for attracting and negotiating new leases.”
-Diego Pacheco, chief growth officer for Ace Pickleball Club, from
“Pickleball Courts Serve an Ace for Vacant Malls, Retail Stores,”
REALTOR® Magazine, Sept. 13, 2023
Why Small Format?
Retailers are expanding by opening more small-format stores to optimize their operations and streamline their costs, GlobeSt.com reports. A case in point: Macy’s department store announced in early October that it plans to open as many as 30 new small-format stores over the next 18 months.
“Our small-format stores are efficient to operate, provide the customer with a shopping alternative within our omnichannel ecosystem and present a unique opportunity to target high-traffic shopping centers,” Macy’s COO Adrian Mitchell said in a statement.
Macy’s isn’t alone. Bloomie’s, the smaller store concept by Bloomingdale’s, opened its third location in November, according to Macy’s, which operates Bloomie’s locations.
In addition, Ikea announced the addition of a “plan and order” store to its portfolio. The footprint is less than 5% of the original flagship store size, according to the GlobeSt.com report. Maxing out at 8,900 square feet, the new format will be designed to simplify shopping for urban consumers by prioritizing convenience, public transportation and delivery, says Nicole Larson, national manager of retail research at Colliers, as reported by GlobeSt.com.
Adapted from “Retailers Have Little Appetite to Shrink,” written by Brian A. Lee and published in the Sept. 19, 2023, edition of GlobeSt.com.