Bite Size Breaking News
Welcome to Bite Size Breaking News. We post every other Monday by noon. Have lunch with The Sinreich Group and get the latest real estate news in easily digestible “bite size” portions.
U.S. Commercial Real Estate Valued at $14-$17 Trillion
According to NAREIT, based on Co-Star data, there is almost 71 billion square feet of commercial real estate in the U.S. valued at $14.4 - $17 trillion. Roughly one third of this value is generated by real estate located in gateway cities: New York, L.A., San Francisco, Washington D.C., Chicago, Altanta and Boston. About half is in the 47 next largest markets. Health care is the priciest at $884 per square foot, followed by hospitality at $617, office at $218 and retail at $179. Learn more
Brick-and-Mortar Continues to Dominate Retail Sales
When it comes to the biggest retailers based on sales, Walmart comes in 1st with just under $388 billion in 2018 sales generated in large part at its 5,263 stores. Next is Amazon, which generated just under $121 billion in 2018 sales, primarily online. Number 3 is grocery retailer Kroger, which generated over $119 billion at its 3,035 stores. Costco, Walgreens and Home Depot were in the 4th, 5th and 6th spots. Interestingly, these top 6 retailers are comprised of generalists and niche players and the lion's share of their 2018 revenue was generated as a result of brick-and-mortar vs online sales.
Athleisure Retailer Lululemon Continues to Thrive
Lululemon Athletica, which offers athleisure apparel from an omni-channel platform that includes 440 stores and a robust online presence, enjoyed a 16% increase in same store sales in 2018 and announced plans to expand its brick-and-mortar footprint in 2019 with 4 different prototype stores, including a 25,000 sf flagship in Chicago with yoga studios, meditation spaces and food and beverage offerings, temporary pop-up stores, and 3,000 sf and 5,500 sf shops. Learn more
Real Estate as a Service vs an Asset Class Across Property Types
As diverse types of real estate ranging from multi-family to office and retail, continue to incorporate hospitality amenities at an accelerating rate, real estate is evolving from an asset class to a service, according to recent PERE article about The Hotelization of Real Estate. Key characteristics of these amenitized properties include the flexibility of short term commitments, minimal upfront investment and a trade off of space for convenience, service and experience. Learn more
Technology Designed to Enhance Productivity
The key to increasing productivity has often been the subject of heated debate and drives many of the office design decisions that developers, owners and occupants face. Technological innovation may hold some answers according to Edge Technologies, which is equipping both new and existing buildings with sensors and lights integrated in prefabricated, modular smart ceiling panels that can provide granular information on air quality, temperature, noise levels and occupancy. The ability to measure and manage these metrics,which are qualities specified by the International WELL Building Institute, can enhance the well-being and comfort of occupants, and thus, theoretically at least, lead to increased productivity. Learn more