Starting pre-Covid, there was a rising crescendo in the press about the "Retail Apocalypse," which was exacerbated, like many things, by Covid. Without a doubt, retail real estate faced many challenges, including the financial crisis, the rise of e-commerce and the shutdowns resulting from the pandemic. Prior to the financial crisis, too many retail real estate projects were built in the United States that, over time, became impossible to keep occupied as numerous retailers downsized or went out of business, and there were few new retailers to backfill those spaces. Malls were hardest hit with the consolidation and bankruptcies of department stores and other retailers prior to and during the pandemic.  

How many times have we heard that people will stop shopping at physical stores because they would rather shop while sitting in their living rooms using a laptop, tablet, or phone? Like so many things, the narrative of the Retail Apocalypse built on itself so much so that people lost track of the underlying fundamentals of retail real estate, the creativity of the professionals running these properties, and the value that these physical spaces add to our everyday lives.

This article from The Wall Street Journal affirms the strength of retail real estate, noting that vacancies are down, rents are up, and more stores are opening than closing. Sure, the dual rise of inflation and interest rates will present challenges to the industry and there remain retailers that will need to either right size their business or go out of business, but, from a big picture industry perspective, retail real estate is here to stay and is indeed flourishing.

Goulston & Storrs has more than 50 professionals who represent owners, retailers, and lenders in retail or retail-related assets, and we are as busy as ever.