A record setting 11,000 U.S. stores could shut their doors this year, according to the brokerage firm, Cushman & Wakefield.
One reason for the market shift: Online shopping, of course.
“On a national scale, we seem to be looking at this trend where about 20% of malls in any given state are either consolidating or closing, and that’s a year over year number, which when you think about it, is staggering,” said Jeff Holzmann, Managing Director at “iintoo,” a global investment network for commercial grade real estate.
Development leaders in central Indiana want to help local businesses stay in town, but the question is — how?
Leaders in Howard County were faced with the same question years ago.
“When we had the real estate crash, if you will, we had a lot of vacancies in our downtown,” said Paul Wyman, Howard County Commissioner.
Wyman says the county’s Rent Abatement Program was created to help business owners relocate or start something new.
“The program is a $5,000 rent abatement program and it’s paid out of a monthly basis over the course of a year. We used our economic development income tax dollars for it and we believe that those dollars are designed for that,” Wyman said.
Wyman says the five-year program just wrapped up at the end of last year, and met its purpose.
“We saw improved quality of the buildings they were leasing, we saw job creation, we saw vacant store fronts being filled and a more vibrant downtown and today we have these incredibly successful businesses,” Wyman said.
In other areas, experts say some landlords are offering deals to keep retailers in storefronts.
Still, they know these solutions may not work for everyone, and the consumers are part of the changing landscape.
“You should continue to consume your products and services the way that fits you best. The reality is, there are some paradigm shifts here, some powered by technology. You should drive the market forces, and not the other way around,” Holzmann said.
Holzmann says some commercial real estate is still growing in our market, like student housing, since it can’t be replaced online.