The Short Version

• Digital twins — virtual replicas of buildings and store environments — are emerging as a key proptech tool for monitoring properties, simulating operations and analyzing retail real estate portfolios in real time.
• Landlords and CRE firms are using digital twins to support property marketing, predictive maintenance, energy management and capital planning.
• Retailers including Walmart, Lowe’s and Kroger deploy digital twins to test store layouts, analyze customer behavior and optimize inventory and operations.
• Adoption is expected to grow rapidly as AI, IoT sensors and real-time data make digital twins easier to use across existing properties and portfolios.

Digital Twins Are Reshaping Retail Real Estate

Digital twins — virtual replicas of buildings and their systems — are helping a rapidly rising number of retailers, property managers and others monitor and control their spaces from afar in real time. Companies like Walmart, Amazon and McDonald’s use the technology across dozens of operational functions, while commercial real estate firms like Cushman & Wakefield and REITs in Asia are applying it to property marketing, portfolio analysis and energy management.

Once built, digital twins help property owners and managers understand their overall real estate portfolios in highly intuitive and diverse ways, said Stephanie Shih-Pei Lin, vice president and general manager of Matterport, a digital twin company that CoStar acquired in March 2025.

Many say the concept originated in 2002 thanks to life cycle-management entrepreneur and scientist Michael Grieves, and NASA’s John Vickers is said to have coined the term “digital twin” in 2010. But the concept, also known as virtual modeling, has NASA roots going back more than 60 years, having debuted in the early 1960s. When an oxygen tank explosion damaged the Apollo 13 spacecraft in 1970, for example, NASA investigated solutions via simulators and modeling, to historic success.

Among the earliest CRE users, Cushman & Wakefield has worked with Matterport since 2015 to build digital images and 3D data that allow it to showcase properties to prospective buyers and tenants with pinpoint accuracy, contrasted with the imperfect data that may come from architects and builders. Matterport reports that its commercial real estate buyers and sellers reduce transaction times by 85% using digital twins. The tech also informs Cushman & Wakefield’s decisions involving market demand and energy use, she said.

How Digital Twins Are Built

To build a digital twin, a user collects extensive data about a physical asset from existing company databases, Internet of Things sensors and devices and other knowledge bases like operational and design specifications. They then use building information modeling, computer-aided design software, geographic information system technology or a combination thereof to create a digital representation. Next, they connect the twin to the asset through a communication channel called a digital thread that facilitates continuous, real-time data flows from the physical asset to the digital model.

The user then can run simulations to predict how the asset will perform under various scenarios, from consumer behaviors to weather and temperature extremes, and how the asset will react to change, all without physically affecting the asset. This feedback loop continuously updates the twin with new data and insights.

How Landlords and CRE Firms Use Digital Twins

U.S. retail REITs have yet to announce adoption of digital twins, but a pair of REITs in Singapore and Australia have demonstrated that digital twins’ optimization of predictive maintenance, energy systems, space use and tenant improvement allocations can reduce capital expenditures, according to a November 2025 report by REITX 2026. Using digital twins since 2022, Singapore-based CapitaLand Integrated Commercial Trust reported a 16.4% reduction in annual capital expenditures across three of its retail and mixed-use properties. “Mall REITs that embrace this technology now position themselves not only for immediate CapEx savings but for leadership in the increasingly digital future of retail real estate,” the report stated.

Numerous hotel brands also use the tech to drive efficiency, improve guest experiences, drive sustainability and accelerate renovations, according to Matterport.

Retail landlords can use digital twins and “smart leases” to avoid long vacancies due to mismatched expectations and to ensure tenants aren’t paying for spaces they only partially use, Science News Today noted in a September 2025 report. Such twins continuously adapt to “provide a precise, evolving portrait of a property, while a smart lease interprets and responds to that data,” the report said. “Together, they create a feedback loop where buildings and tenants exist in harmony.”

Digital twins also can provide time-stamped documentation of existing conditions for all company locations, Shih-Pei Lin said. “Ultimately, adoption succeeds when technology fits naturally into existing workflows,” she noted. “More broadly, it reflects a shift we see everywhere: Digital twins are becoming a standard part of how properties are marketed, transacted and managed. That is where the long-term value shows up.”

In a Deloitte 2025 report called Doubling Down: Digital Twins in Corporate Real Estate, senior manager Cindy Li noted that many think digital twins serve only new construction projects. “The reality is that digital twins hold equal, if not greater, value for existing buildings,” she wrote. “Their application extends well into the operational lifespan of structures.” Twins can analyze “vast amounts” of historical data — including maintenance records, renovation history, blueprints, permits and inspections — to provide context on an asset or property’s conditions, she said. They help position organizations “at the forefront of the industry, ready to navigate the evolving modern real estate environment with agility and precision,” she noted.

How Retailers Use Digital Twins To Simulate Store Operations

For a retailer, a digital twin can mirror a store’s physical features and inventory, as well warehouse operations, using live, data-driven simulations that integrate with company data. When paired with AI, IoTs sensors, algorithms and other technology, a digital twin can streamline store operations — for example, simulating and predicting customer demand, reimagining store layouts and testing new products. “They provide instant dimensions,” said Shih-Pei Lin. “This includes ceiling heights and room areas, which helps owners quickly evaluate preliminary costs and expected returns for capital projects, all without the need to physically open highly technical and resource-heavy files.”

To avoid travel to sellers during the pandemic, wholesale retail buyers adopted digital twins for quality and color checks, and that has become standard procedure for numerous brands, she said. “Buyers are able to accurately see and understand key details, such as all the colorways [color ranges across styles and designs] per SKU, without the need to travel.” Similarly, BMO’s use of digital twins in its 2023 acquisition of 503 branches from Bank of the West saved more than $500,000 in travel costs over 15 months, she said.

Retailers typically have used photos to show in-store teams how to display products in their brick-and mortar stores. For Guess, however, Matterport creates 360-degree models of product displays for this purpose, Shih-Pei Lin said, leading to a 95% decrease in the brand’s paper and printing costs, amid other savings.

Other retailers putting digital twins into action:

• More than 1,700 U.S. Walmarts use floor plan twins to monitor infrastructure, the checkout area, parking lots, shelf layouts, customer-shopping patterns and HVAC, among other functions.
• Walmart Inc.’s Sam’s Club monitors maintenance operations in 4,200 stores and has reduced emergency alerts by 30% and refrigeration maintenance costs by 19%.
• Lowe’s updates data from its 1,762 stores in its twins daily and in some instances in real time. That data interacts with other tools embedded in the twins, such as CAD models, fixture layouts and product-placement diagrams, it said.
• Kroger combines computer vision analytics, which is a field of AI machine learning, and Nvidia’s Isaac Sim, a robotics-simulation framework, to simulate how shoppers would use cashier-assisted and self-checkout configurations. The process reveals the most time- and cost-efficient combinations of the two, Kroger said.
• Nike creates virtual replicas of production lines, designs and tests footwear virtually before making physical prototypes and provides augmented reality “try-ons” so customers can visualize how shoes look in real-world settings.
• Ikea similarly allows shoppers to visualize products in lifelike spaces.

How Quick-Service Restaurants Use Digital Twins

Quick-service restaurants also have adopted the technology. Taco Bell, Domino’s, Wendy’s, Chick-fil-A, Burger King, KFC and Pizza Hut also use digital twins, according to Deyvos, an AI and machine-learning specialist that serves retail, healthcare and finance.

McDonald’s is experimenting with digital twins to tighten kitchen efficiency, deploying IoT sensors to monitor fryers and grills. The chain has reduced equipment downtime by 40% through predictive maintenance, improved its order-fulfillment times by 25% and reduced waste through food inventory management, according to a 2025 report by Deyvos Labs. Subway used the technology to analyze sandwich-making workflow and reduced order-preparation time by 20%, thus ensuring customers get their meals faster during peak hours, Deyvos noted.

Starbucks leveraged twins to optimize its drive-thru by analyzing customer flow and order patterns, and it reduced wait times by 12%, increasing customer-satisfaction scores by 15%, according to Deyvos. The coffee giant also uses the technology to understand customer preferences. Before moving forward with a seasonal drink, for example, Starbucks first simulated whether customers would be more prone to order it in-store or by drive-thru and how frequently they’d repurchase it, Starbucks reported..

Digital Twin Adoption Is Expected To Accelerate

The global market for digital twins is expected to grow more than tenfold, from $24.48 billion in revenue last year to $259.32 billion by 2032, Fortune Business Insight estimated. “Adoption follows clarity of use,” Shih-Pei Lin said. “As digital twins prove their value beyond marketing, particularly in operations and decisionmaking, interest tends to translate into broader use.”

Digital twins don’t require special skills, she added. For most users — including brokers, owners, operators, asset managers and tenants — “it’s as simple as opening a link in a web browser,” she said, where users can monitor digital/physical pairs on augmented reality headsets, desktop computers and mobile devices.

The appeal of digital twins is real, Shih-Pei Lin added; it’s not because the technology is the latest, flashiest AI toy or because it’s a nice-to-have perk. “Once people experience how much easier it makes tasks, the value tends to be self‑evident,” she said. “It’s a practical tool that becomes part of everyday workflows, such as marketing, planning, operations and documentation.”