In complex real estate, the obvious path rarely creates the most value. The easy answer is usually to list the property, sell to the highest bidder, move quickly, and let the market decide. That approach can work for simple assets. But complex real estate is different. When a property involves community sensitivities, entitlement risk, infrastructure needs, mixed-use potential, long-term control, capital constraints, public incentives, and multiple stakeholders, the obvious path can leave significant value behind. The uncommon path takes more work.

±4.55 Acre Mixed-Use Redevelopment Opportunity | Dominant Infill Location in Heart of DFW (Downtown Arlington, TX)

Over the past couple of years, investors have become skittish of retailers and retail shopping centers susceptible to online retailing. In some instances, for good reason. The fear of the “Retail Apocalypse” is in full swing these days, and I can’t seem to read one major news report that doesn’t talk about the catastrophic destruction of retail shopping centers, the demise of brick-and-mortar retailers, and how Amazon is going to take over the retail world.

During the 2018 holiday shopping season (November 1 through December 24), U.S. consumers spent an estimated $850 billion, the strongest in the past six years Thanks to near full employment and rising wages, consumers have boosted their spending accordingly, which hit its highest level in nearly two decades.

As you may have noticed there are less traditional shopping centers being built today than 10 years ago and many are being torn down, back-filled with non-traditional retail uses or are slowly declining into obsolescence. You may know of some that were torn down and replaced with an apartment project, have been backfilled with self-storage, a church or a medical user, or you drive by and wonder why it’s still there! What you may not realize is that you are witnessing a major disruption in the retail industry caused by the Internet / technology and demographic shifts. Consumers today are demanding something different than what the old retail model provided. So what are consumers today demanding? They still want the same goods and services, but they want to acquire and consume them differently.