CRE_Editorial_September_NAT_BUY_0917_V1_RetaileCommerce|&utm_term=|Editorial-Editorial-NAT(Editorial)|"> Auction.com's chief economist Peter Muoio exclusively about the real impact e-commerce has had on retail real estate and the next step for bricks-and-mortars as online sales continue to mature.

GlobeSt.com: How much of a bite out of bricks-and-mortar sales is e-commerce taking?

Muoio: It's a major issue. I don't think we're near to capping out on e-retail. Phones and apps and tablets are only getting easier to use for purchases. Also, every time there's a spike in gas prices, people don't want to go to the store and use up gasoline—they'd rather have their purchases delivered. Sites like Amazon and Google offer same-day delivery, which means that people can do more of their commodity-like shopping online. Our kids are becoming used to this—you go online, see a product, order it, and it appears at your door. They grew up with a different pattern of shopping than ours, which will phase out as this new generation's way of living takes over.

GlobeSt.com: How are the bricks-and-mortars reacting to this loss?

Muoio: The good ones are adapting and using it to augment sales and reconfigure their stores. Others have been playing the blame game, saying that the uneven distribution of sales tax makes it harder for them to compete and causes them to lose sales to e-tailers. But I don't believe that any legislation to uniformly apply sales tax to e-retailers would significantly affect the Amazons and Apples of the world. They're already paying sales tax in many states because they have a physical presence with their distribution centers. It's interesting to note that the United Kingdom has a higher share of e-retail compared with the United States, and they don't have this sales tax issue. What it comes down to is that it's a matter of increasing consumer preference for online shopping.

GlobeSt.com: What's the next evolutionary step for bricks-and-mortars as e-commerce continues to mature?

Muoio: Retailers are adapting, and good retailers already have a strong online and bricks-and-mortar presence. Macy's did well during this past Christmas season relative to other department stores, but a lot of their sales came from online business. E-commerce is good for them because otherwise they wouldn't be getting those sales at all.

From a real estate perspective, it's more a matter of how the space is used—and in this case, the winner is the industrial real estate sector. It's much more efficient and cheaper to spend real estate dollars on a distribution center than retail space. Stores of the future will have different sizes of footprints: Retailers are reconfiguring their stores so they don't need as much space for inventory. We see this in particular with banks, which are a ubiquitous user of retail space. A lot of the big banks are opening up 400-square-foot micro-bank branches in which tellers with iPads are helping customers. They don't need the big teller wall. But really, if a bank has two micro-branches, it has twice the exposure as it does with one. All kinds of e-issues are changing the footprint of stores. So in some ways, retail space will be the loser to this evolution as retailers reconfigure, but industrial real estate will come out ahead.