The future of retail in light of e-commerce and the future of parking lots and garages in an era of autonomous vehicles were some of the topics discussed at the Real Estate Impact Conference in Miami.
The University of Miami School of Business Administration and School of Architecture hosted the seventh annual conference Friday.
Speakers who shed light on the future of real estate were Barry Sternlicht, founder and CEO of investment fund Starwood Capital Group; Joseph Brancato, managing principal for architectural firm Gensler; Benjamin Conwell, senior managing director and national practice leader for e-commerce and the electronic fulfillment group for the Americas at Cushman & Wakefield; Juan Nuñez, Florida regional president of Whole Foods Market Inc.; Fred Rothman, Eastern regional president of Miami-based homebuilder Lennar Corp.; and Arne Sorenson, president and CEO of Marriott International Inc.
Here are some of the takeaways from the conference.
- Evolving Retail
There isn’t any part of retail, brick-and-mortar stores or e-commerce, that’s not being rapidly disturbed by new technology, said Cushman & Wakefield’s Conwell.
“We as consumers, whether we are millennials or old baby boomers … everything about the way we interact with retailers is changing,” he said.
That includes what form and how that interaction is changing as retailers learn more about consumers with the growing use of big data, Conwell said. Big data allows retailers to make more personalized offerings to consumers.
“We are just now finally seeing really, really powerful applications of that when it comes to retailers … and the experience to shoppers,” he said.
But Conwell added well-curated, well-planned and right-sized shopping centers will remain players in the industry despite the fast-paced changes in retail.
“The world of the shopping center, especially of a Whole Foods anchor … those days are far, far from over,” he said.
Sternlicht of Starwood Capital Group added the future of retail is uncertain, but those who are able to reinvent the brick-and-mortar space and give consumers an experience — such as “sexy” food halls with music — could survive.
“The guys who are strong and have money, they’ll survive, and the ones who don’t will become marijuana factories and distribution centers,” he said.
- Autonomous Vehicles
There are at least 105 million parking spaces in the U.S., according to The New York Times. But the proliferation of ride-sharing and driverless cars makes parking less necessary — and some garages could be repurposed, said Gensler’s Brancato.
Understanding “what can be done with parking is really important,” Brancato said, adding Gensler has studied the subject.
Some of its findings: Garages can be changed into distribution and data centers. Urban garages are ideally located as distribution centers and could serve as the “last mile of distribution,” Brancato said.
If autonomous vehicles enter everyday use as expected, they may necessitate more data centers, he added.
“Maybe there will be many data centers that are needed throughout the cities, and that may be a new purpose” for garages, Brancato said.
Architects are designing garages that could be repurposed in the future. For example, an office building in Cincinnati Gensler worked on has three levels of above-grade garage built in the middle of the building, Brancato said.
It’s “strategically located … in the middle of the building” so that if needed it could be repurposed as office space, he said.
- Marriott-Starwood Merger
Marriott International in September 2016 paid $13 billion to acquire Starwood Hotels and Resorts Worldwide Inc., the hotel company founded in 1995 by Starwood Capital Group CEO Sternlicht.
“I actually proposed this merger,” Sternlicht, who stepped down as CEO of Starwood Hotels and Resorts in 2005, said at the conference. “One of the last things I did was visit Arne (Sorenson) and said, ‘You should buy this. We should merge.’ ”
Starwood brands added to Marriott’s portfolio include St. Regis Hotels & Resorts, W Hotels and Sheraton.
The merger made Marriott the biggest hotel company worldwide with 1.1 million rooms in more than 110 countries, according to USA Today.
- Plenty of Boxes
The growth of e-commerce, which generates $500 billion U.S. sales, is bringing new issues — like shipping boxes with small contents.
“That’s a whole lot of brown boxes going around,” Conwell said.
He encouraged conference attendees to keep the pressure on public agencies to provide recycling, if they don’t already, and on companies to ship in small, biodegradable and environmentally friendly packaging.
“Keep the pressure on companies like Amazon, on Apple, these retailers,” Conwell said. “They’ve got to get better. The good news is there are great opportunities to get better.”