As millennials’ lives evolve, so do their shopping habits. The cohort already makes up the largest share of today’s population, and they are now in the thick of family formation and their peak earning years. Real estate investors are watching closely, seeking to “buy demographics” and position themselves to where demand is headed.
“They're getting married, they're buying homes, they're having children, and their priorities and preferences are changing,” explains Katie Grissom, global head of Retail at Nuveen Real Estate.
At the same time, a powerful behavioral force, what experts call “convenience culture,” is reshaping how this generation spends its time and money. The shift is disrupting traditional real estate development and creating new opportunities.
“The consumer is evolving a lot more quickly than real estate is,” Grissom observes.
The suburban opportunity
Millennials are moving to the suburbs at rates similar to previous generations, and retailers are following. Brands that once focused on dense urban markets now see opportunity in neighborhood-based lifestyles, a trend accelerated by remote work.
"Working from home, even two days a week, people are spending more time in their neighborhoods, blending their professional and personal lives more than ever," Grissom says.
Yet suburban consumers expect urban-level amenities. "You still want the creature comforts that you were used to in the city," Grissom says. "Retailers can go [to the suburbs] and do similar volumes and sales but pay lower rent."
Looking beyond the basics
Grocery-anchored shopping centers have long been a favorable investment due to their higher occupancy rates (94% vs. 90%). But for affluent consumers, necessity retail is much more in demand, now including wellness services, medical offices, and premium food.
Real estate owners and developers are paying attention. They’re focusing on what Grissom calls "habit stacking," creating opportunities for multiple errands in a single trip.
A pediatrician tenant alongside a smoothie shop, or a workout studio near a popular café, creates cross-shopping opportunities that boost traffic and support premium rents.
Digital integration is key
At the core of convenience culture is the removal of retail friction. Consumers don’t distinguish between digital and physical shopping. They expect seamless experiences. Ecommerce integration is essential, but it requires capital investment for specialized infrastructure.
“Consumers just want what they want when they want it, and it’s the retailer’s job to provide that,” Grissom says.
For investors, properties with click-and-collect capabilities, optimized parking access, and technology infrastructure are attractive opportunities. While this requires upfront investment, it's crucial for attracting quality tenants that operate in both the physical and digital space.
Global opportunities, but with regional twists
Convenience culture isn’t restricted to the US, but there are regional differences. In Europe, aging populations and flat growth mean retailers must appeal to all the generations. “The pie is smaller, so you’ve got to get more people in your store,” Grissom observes.
Grissom also likes Australia. Similar to the US, their grocery sector has low e-commerce penetration in grocery, with most sales still happening in-store. Grocery retailers, therefore, place even greater emphasis on location and demographics.
Convenience culture is about solving consumer problems efficiently. Properties that save time, reduce friction, and enable multiple-purpose trips are positioned to benefit as this trend continues to reshape the retail landscape.
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