CHICAGO—Retail is in many ways the most challenging sector in commercial real estate, largely due to its well-known struggles to prosper in an environment shaped by the rise of e-commerce. But many investors feel it's a smart time to buy, as long as they focus on finding assets that respond creatively to the changing needs of today's consumers, according to Real Capital Markets' May 2018 Retail Investor Sentiment Report.

Although the many big box vacancies and high-profile retail store closures such as Toys R' Us produce chilling headlines, investors surveyed by RCM remain optimistic. And many say retail owners who embrace new models—ones that provide experiences or mix in residential, office or entertainment options—can still succeed in today's retail environment.

RCM says 48% of investors surveyed still consider grocery-anchored shopping centers the best investment, while strip centers were a distant second choice at 23%, a greater margin than in 2017. Groceries do face challenges like the popularity of on-line ordering and prepared meal concepts, but most experts say these the internet can't replace such stores.