Am a huge fan of Aby Rosen for his real estate acumen (and for his extraordinary art collection!). But his rationale for buying some recent downtown properties: to turn them into high-end retail, baffles me – and prompted this post. A short walk around Manhattan, with its thousands of empty storefronts, should be enough to raise red flags for Rosen’s RFR Realty (he is currently doing a retail conversion for the Germania Bank on the Bowery and up next, the building that formerly housed a women’s homeless shelter on Lafayette and Bond).
I’m going to call this early: developers will start to seriously rethink the economics and strategies related to “retail at the base of buildings.” Currently, they seem to be living in a fantasyland where e-commerce doesn’t exist, e-banking has yet to take hold and shoppers haven’t yet opted for experiences vs. things.
The retail sectors that are growing, and will occupy more ground floor retail, include: food, restaurants/cafes, specialized gyms, co-working spaces and pop-ups. The latter are super hot for both small artisan sellers (e.g. Etsy vendors) as well as bigger brands like Target who are looking to create a more experiential retail presence.