Is eCommerce Hurting Commercial Real Estate?

Commercial Real Estate

Is eCommerce Hurting Commercial Real Estate?

Whether you’re a commercial real estate agent or your business relies on physical retail, the ever-growing presence of eCommerce is changing how you operate. Big time retailers like Sears, J.C. Penney and Macy’s saw a record number of closures in 2017, with more closures on the horizon this year. On the other hand, the new online retailer and app, Wish, has become larger and is now worth more than all 3 of them combined(1)!

What does all this mean for you? For commercial real estate agents, you might see it as a liability to lease to a retail business considering current trends. If you ARE a retail business, how do evolve your business to be successful?

The answer to both lies in understanding retail consumers. The ease of ordering online has continued to reduce the number of in-store customers. If it’s easier to purchase online, especially an item that is available from several retailers, consumers flock to their phones as opposed to stores. But it also means two things.

What It Means For Commercial Real Estate Agents

  1. Consumers are still willing to come in store for things that motivate them. If your retail store offers exclusive in-store deals or items, offers items that are not offered at other retailers, the business’ unique selling position might be enough to bring in foot traffic. What helps even more, is having a retail store that is a part of a larger shopping experience. If a consumer can shop, get lunch and complete other tasks at the same time it fills the niche of “convenience”.
  2. eCommerce retailers still need to lease or buy commercial property. More and more retail shops are offering an online store — even smaller, local retailers. Meaning they operate a walk-in store and also run an eCommerce business within their store. Square footage requirements change, with business owners putting more emphasis on storage and building updates (such as wi-fi), but the need for retail space is still there.

What to Do With That Knowledge

While retail and consumer trends change over the years, commercial real estate needs to adapt with new business owners to fit their needs. Recognizing what type of retail business will thrive in your lease, helps you and your tenant in the long run! As a retail owner or new start-up, it’s also important to keep an eye on trends and build your business to last.

Our service-based philosophy has made Dominion Advisory Group the “go-to firm” for adding asset value and providing stabilized services across all of South Texas. We have available leases in several high-traffic, convenient areas including brand new, up-to-date constructions that help bring our tenants into the market.

At Dominion, we understand that every person and every business is unique with its’ own story and specific needs. Contact us or look at one of our available properties for lease and let’s get started building your new business venture.



  1. At $8.5 Billion, Shopping App ‘Wish’ Is Now Worth More Than Sears, Macy’s And JC Penney Combined, Parmy Olson

This article was posted on July 25, 2018 in Commercial Real Estate.