The commercial real estate sector has been seeing a lot of changes over the past several years and the industry has had to figure out how to work through these changes. One of the categories with some of the biggest changes is the grocery sector. From grocery delivery services to consumers looking for more options, there are many factors at play here and it behooves everyone in the industry to pay attention.

Here are a few of the trends happening now in the grocery sector, and where this may take us …


1. Online Shopping and Home Delivery

Perhaps the most dramatic changes to happen to grocery (and many industries) is ecommerce and online shopping —both of which have brought convenience and options to today’s shoppers. Amazon Fresh, Instacart and others have made it incredibly easy for shoppers to skip the grocery store altogether.  This has resulted in brick and mortar grocery stores needing to rethink their strategy by offering similar services like home delivery and the ability to order online, as well.

This shift has forced the industry to relook the way that grocery stores are being utilized. Store closings are a reality, while many grocers are looking for additional warehouse space for distribution of online orders, etc.


2. Specialty Stores

At one time, the one-stop-shop was the trend and it squeezed out many smaller specialty stores like neighborhood butchers and delis. However, the trend has been reversing as consumers are starting to care more about where their food is being sourced and what it contains.

This has led to a revival of  smaller specialty stores especially in the live, work, play neighborhoods that have become more desirable. It also has seen the rise of grocery stores that are more conscious of these types of items like Whole Foods. From a CRE perspective and a general real estate perspective, this has seen the rise of value in neighborhoods where these stores are located.


3. Amazon’s Purchase of Whole Foods

Amazon has already disrupted the grocery industry with their grocery delivery service, Amazon Fresh, but their purchase of Whole Foods is a step towards them expanding their massive ecommerce footprint into a complimentary brick and mortar footprint. This will give them an already functioning network of brick and mortar locations to expand upon. It may also help to expand their recent introduction of Amazon Go, which is removing the idea of a physical checkout by utilizing deep learning and scanning technologies to record the items that you take off the shelf and charge you when you walk out of the door. If Amazon can bring the same change to brick and mortar that they did to ecommerce than there will be an even more dramatic shift in the grocery industry.

With these trends, the grocery sector is one to watch and one to prepare for. Coldwell Banker Commercial  is following these to help prepare our clients for what is to come.

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