Paradigm Tax Group Industry News

Paradigm Tax Group Industry News

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    Are 'Shopping Fulfillment Centers' the Answer to Vacant Malls?

    15 Jan, 2019

    Vacant malls transformed into retail and warehouse hybrids may become the newest form of retail. Combining the news of both the shuttered department stores and the demand for fulfillment warehouses, Case Equity Partners is creating a new retail solution coined “shopping fulfillment centers” or SFCs. Envisioning an immersive, shopping and lifestyle center in the front with a high tech robotics fulfillment center in the rear, shoppers would get the best of both worlds. They can try on or try out a product in store before purchasing, while not having to worry if it is in stock and getting to choose whether to take it home or have it delivered. Case Equity is buying retail properties with vacant anchors focused in the Mid-Atlantic to bring to life this concept.

    In a interview, Shlomo Chopp, managing partner at Case Equity Partners, describes the centers: Imagine a vacant 100,000 square-foot department store, like a former Sears. Ten small retailers could lease the front 30,000 square feet in a highly curated, experiential environment. The rear 70,000 square feet would serve as a warehouse and fulfillment center for the onsite stores, digital customers at home, and satellite stores. As the group of retailers would be smaller, they wouldn’t require the large-scale Amazon-like industrial properties. Their warehouses would be less square footage, on-site and closer to the customer. 

    There is no upfront cost to the retailer except designing a retail store, similar to a “pop-up” location. The SFC would provide the logistics infrastructure. This would track and manage inventory, deliveries and returns. Thus, the age-old risks for retailers of leasing out space—guessing and hoping their sales will be high enough to make the rent is greatly reduced. In this new form of retail, Chopp says real estate landlords are not about leasing space but more about maximizing shoppers. With the onsite fulfillment centers, Case Equity also anticipates that the costs and inconveniences associated with returned merchandise will greatly decrease. It’s not just the “glitz and glamour” of “experiential retail” that many brands have been trying to market, according to Chopp. He says it’s also functionality that allows for the best experience: convenience.

    For the full article from, click here

    Topics: Industrial, Real Property, Retail, Malls, Warehouse