MILWAUKEE—Retailers need help now more than ever from those with market knowledge and local expertise to help them find the right location for their business to thrive and grow for years to come, Dan Cohen, principal and director of tenant representation at Mid-America Real Estate—Wisconsin, tells GlobeSt.com. With the closure of many big-box retailers, new opportunities are being created for those retailers that are looking to expand.

Retail is evolving, and as some big-box retailers are faced with bankruptcies and closures, others are finding their niche with brick-and-mortar or e-commerce. We sat down with him for a chat about how retailers are benefiting from the space left behind by big-box retailers, how big-box retailers are adapting to the changes that have hit their sector and how local market experts can help both cohorts right-size their space for greater efficiency.

GlobeSt.com: How are retailers taking advantage of the space being left by big-box retailers to expand their growing businesses?

Cohen: The way retailers that are in growth mode and have the balance sheet to grow are taking advantage of some of the space from big-box or online retailers is to be strategic in potential opportunities. They are not waiting for appropriate space to come on the market, but are getting their ducks in a row so they're prepared to respond immediately when it does come on the market. Their operations, leasing and finance team are reviewing at-risk retailers' real estate so they can have the tools necessary to convert spaces and have buy-in from the executive team in order to be able to move very fast. In the retail world, things are moving at a faster pace than anyone has seen before. It's such a dynamic pace that you can't sit and wait any longer. Don't just react, but create an opportunity that may at some point to be put in front of you on which to decide.

GlobeSt.com: How are big-box retailers adapting to the changes that have hit their sector?

Cohen: The goal of any retailer is to maximize its profitability per square foot, to utilize its GLA to maximize revenues and profits based on that GLA. Many big-box retailers are realizing that they don't need that much GLA to maximize their revenues or that they need to reconfigure to manage expenses. The customer has many different ways to get that product; the retail market is not as centered on the brick-and-mortar store as it used to be. These retailers have to figure out how to get those sales and revenue, and they know it's not through their brick-and-mortar stores, which means going online. Ten years ago, all the revenue that the large-format retailer made was in a store. Now, that revenue is coming from stores and online and possibly from a different type of brick-and-mortar space.

For example, here in Milwaukee, Kohl's used to have the big-box Kohl's department stores that anchored the mall. Then they went to Kohl's off-mall size, and now they are offering Off/Aisle by Kohl's, which offers a different touchpoint to their customer. They don't need to go to a full line Kohl's store.

Going back 30 years, if you wanted a pair of Levi's, you would go to a Levi's store and have a selection of four styles. Now, you don't even have to leave house, or you can go to a Levi's store or a specialty store—there are many options. Retailers have to be prevalent and relevant to customers, and they don't necessarily have to have hundreds of big stores anymore.

GlobeSt.com: In what ways are local market experts helping big-box and small-but-growing retailers right-size their space for greater efficiency?

Cohen: Our job as a local market expert is representing our clients—not just in growth mode, but also in operational mode—to right-size their space in local markets using a combination of our local knowledge and our history in a market. We are touching the real estate market every single day, creating opportunities for our retailers. It's not just about the real estate deal, but also about acting on our clients' behalf. We do competitive analyses and to make sure they are in the right store with the right co-tenancy and the right real estate deal so that they are in the right position to perform for their companies. Our job is executing on a strategic plan—not being reactionary, but putting clients in a place to be nimble and create opportunities.

GlobeSt.com: What else should our readers know about this topic?

Cohen: Right now, we're just at the beginning of it. Retail is in a constant evolution, and retailers need a local expert with knowledge and relationships because we are at the beginning of the evolution of square footage, adjacencies and the cycle of right-sizing; our job is to help them get there.

GlobeSt.com: How are retailers taking advantage of the space being left by big-box retailers to expand their growing businesses?

GlobeSt.com: How are big-box retailers adapting to the changes that have hit their sector?

GlobeSt.com: In what ways are local market experts helping big-box and small-but-growing retailers right-size their space for greater efficiency?

GlobeSt.com: What else should our readers know about this topic?

Instant Insights /

Why Retailers Need Local Experts to Help Them Right-Size

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