Why are the hottest brands and restaurants moving to the suburbs?
By Adam Ifshin, CEO and founder of DLC
At DLC, we have never been more bullish on the fundamentals we see at the property level. Retailers are waiting in line for any vacant space. We see a clear migration of consumers and establishments toward the suburbs, and open-air retail is perfectly positioned to flourish in this environment. Download A Breath of Open-Air today and learn more about the hottest asset in CRE.
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The numbers do not lie. Open-air retail is thriving. Customers are looking to stay closer to home to shop. Lifestyles have changed and people are looking for greater convenience and options in a neighborhood shopping center. This attracts a greater mix of retailers and services to a center. Gyms, wellness, eatertainment, medical services. It’s about becoming a destination which is more experiential.
Keep in mind what we at DLC call the “3% handcuffs.” In 2021, home sales in U.S. hit a 15-year high with people securing 30-year mortgages at historic lows of 3% or less. Rates are now 3 to 4 points higher. Most of these homebuyers will not be going anywhere anytime soon. This is a long-term fundamental shift that positions open-air retail as a driving force in neighborhoods for decades to come.
Migration to the suburbs and working from home have reignited interest in suburban open-air retail for consumers, tenants and investors. In the era of e-commerce, customers still benefit from and like being physically close to their favorite retailers — and the retailers know it. They are looking for opportunities in both big-box and smaller-format stores.
The trends clearly show traffic growth in suburban markets and decline in urban markets. We’re in growth mode at DLC, working with new and expanding brands, investors and formats and expanding our services to include construction and architecture. Following a record 2022 in occupancy and leasing, we're on a clear path to growing our portfolio with the right groups of investors and partners. DLC is primed for continued success. Learn why.