In Midst of Retail Disruption, Real Estate Pros Recalibrate

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Retailers are facing a lot of pressure right now, real estate pros told Commercial Observer at MAPIC, with the looming threat of interest rate hikes, the impacts of e-commerce and the reality of high rents.

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“I think there is a global slowdown in retail. Nobody’s happy about that,” said Susan Kurland, the co-head of global retail services at Savills Studley.

To deal with that shift, Kurland, an executive vice president, and partner David Gialanella, an executive managing director, are looking to be more specialized and focused on certain product groups. “It’s much more of a consultative business along with the brokerage,” Kurland said.

On the landlord side, Christopher Conlon, an executive vice president and chief operating officer at Acadia Realty Trust, said his company has “decided to go out in a more aggressive, more structured campaign-like manner and meet with retailers about their business.”

What that means is, instead of peddling their wares (read: developments), Acadia executives are taking a more holistic, retailer-focused approach, asking current and potential tenants about their needs, while on the retailers’ turf. One group focuses on the suburban open-air community and the other is handling the High Street urban retail.

“I can’t think of a time when retailers faced so many challenges,” Conlon said.

Jedd Nero, a principal of Avison Young and the executive managing director of New York City retail, noted that with more supply than demand, landlords are being more proactive.

As a broker he said it’s important to make retailers aware of the realities of the future in terms of technology and e-commerce, but at the end of the day “there is no silver bullet.”