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ICSC Connect Virtual Series: Retailers want fulfillment help at their shopping centers

May 29, 2020

The COVID-19 crisis has forced retailers to ramp up their omni-channel operations, and they need real estate that can help facilitate fulfillment of online orders, experts said on the ICSC Connect Virtual Series episode, Inside Retail Logistics and the Impact on Real Estate. “Our customers recognize that it’s important to have a store, but they want to know how to maximize use of that space without paying for too much space,” said Kevin Bass, senior engagement director at retail logistics consultant Manhattan Associates.

On retailers’ wish lists, he said, is a central location on property where they can store merchandise for pickup and delivery by third-party services. They’d also like a property-based courier service to run merchandise from storefronts to customers’ vehicles in parking decks and lots.

Apparel chains, in particular, are seeking to replicate a personal shopping experience virtually, Bass said. “The ability to create appointments for in-store visits is an ever-increasing topic,” he said. Some of the company’s non-food retailer clients are streamlining curbside delivery operations and adopting best practices like geolocation apps from pizza delivery and fast food.

Vacant mall anchor spaces and big-box stores might seem like prime candidates to become fulfillment centers, but such uses don’t generate the sales tax or the number of jobs that communities want, said Chris Zubel, CBRE industrial and logistics investor services lead and senior managing director in Chicago. “We have not seen it happen very frequently,” he said. “You almost have to knock the shopping center down unless there’s an outlot because people don’t like trucks. No one wants to be intermingled with 50-foot trucks.”

Such boxes might be more useful as “dark stores” for third-party delivery fulfillment like Instacart and for curbside pickup of online orders. “If it’s an individual retailer that is generating sales tax, they might have a shot at it,” Zubel said.

The full ICSC Connect Virtual Series episode is available here (Chrome works best).

Click to read about and listen to other recent Virtual Series episodes from ICSC

COVID-19 liability for shopping center owners

How to make your reopening a success

Which safety measures shoppers value most

How to adapt to the stress of working from home

Kimco’s Conor Flynn talks reopening timelines

Full ICSC Connect Virtual Series library

By Brannon Boswell

Executive Editor, Commerce + Communities Today