Commercial Real Estate

Retailers Can Learn From RH’s Efforts To Revolutionize Physical Stores

RH New York – The Gallery


I just received my copy of RH’s catalogue and immediately loved the building pictured on the front.  I liked RH as a brand even more when I opened the front cover and read CEO Gary Friedman’s piece, The Death of Retail Is Overrated.  In it, he states that “…most retail stores are archaic, windowless boxes that lack any sense of humanity” fresh air or natural light.  Just that description of a retail store would make me shop more online, from the comfort of my home or office, both of which have plenty of windows and light.

However, he goes on to state that since we are both social and physical creatures we still like experiences.  This of course ties in to the whole “experiential retail” trend that the industry is pursuing to keep the customers it still  has and bring new customers in. RH New York – The Gallery is the building featured on the cover.  It is RH’s latest space that integrates food, wine, art and design in the Historic Meat Packing District.

In addition to 5 Ways Retailers Can Engage Consumers, brick an mortar stores can follow RH’s example by creating spaces that:

  • “blur the lines between residential and retail, indoors and outdoors”
  • “are more home than store”
  • “are filled with fresh air and natural light”
  • have “garden courtyards, rooftop parks, restaurants, wine vaults and barista bars”
  • “activate all of the senses, and spaces that cannot be replicated online”

In Don’t Hold A Funeral For Retail Just Yet,  I emphasized that retail wasn’t dead but rather shifting and that brands that provided their customers with options and experiences would fare well.  Mr. Friedman worded it eloquently when he wrote: “… the physical manifestation of a brand will prove to be the most compelling and cost effective way to engage and inspire customers in a physical world.”




Buying Commercial Real Estate

Is TAMI Coming To A Town Near You?

Google’s Latest NYC Purchase

All of the large tech companies appear to be on a buying spree. Google’s $2.4 billion purchase of the Chelsea Market Place building shows how insatiable these large companies can be. Loaded with cash and apparently feeling bullish about how recent tax reform will affect them, they are on a purchasing and/or expansion binge.  This is great news for the economy as it keeps real estate and employment on an upward trend.

As reported last week by Lara O’Keefe of Bisnow the top tech companies are planning the following:

Google – open offices in 9 states throughout the U.S
Facebook – open five data centers over the next year.  Redevelop 3.45 M SF at the former Menlo Science & Technology Park
Apple – spend approximately $10 billion adding onto existing data center facilities.  Adding another campus at a yet to be determined location
Amazon – opening a second headquarter

So, what does this mean?  Both commercial and residential real estate prices in the areas where these companies put their offices, data centers, operation centers and warehouses are going to increase as will the employment rate and demand for skilled workers.  Since tech companies like to be with other tech companies as well as creative ones that focus on advertising, media and information, there will be an increased presence of these companies wherever Google, Facebook, Apple and Amazon locate their offices.  The effect that these companies, collectively referred to as TAMI (tech, advertising, media, information) have on an area’s real estate should not be underestimated.  Just take a look at the prices of real estate in Silicon Valley, the San Francisco Bay Area and Manhattan.