• The “death of retail” once again over dramatized.

  • Fatigue is pushing some to exit.

  • Challenges with refinances in 6-18 months will create opportunity but very little real distress in the NW.

  • Remote work vs. physical space, productivity, employer flexibility. 

  • Deal structure changes:

1. Enough data points and light at end of tunnel

2. Increase in guarantees and/or holdbacks

3. Debt availability for right deals, but not all

4. Larger lender reserves and holdbacks for future government shutdowns.

  • Debt drives salability more than ever.

  • Shorter-term leases with tenant flexibility, percentage rent, termination rights, rent reductions, force majeure clause.

  • Changes in grocery and pharmacy will be the largest upcoming evolution.

    • Amazon Grocery - large and small format

    • Delivery/pickup growth and here to stay

    • Pharmacy

      • Walgreens 2,500 SF drive thru only - what once was the gold standard is setting up for massive change

      • Amazon pharmacy coming

      • 14k sf prototypes outdated and very risky in most locations

  • Technology - AI, Virtual Reality all on the horizon to upset, shift, reinvent brands.

  • Repurposing and vertical development. 

  • Alternatives uses - Industrial, MF, medical, office. Taking advantage of excess parking and densification.

New Paradigm