State of the Industry 2020 | Coming Soon: The New Reality

IN MID-APRIL, the March economic reports screamed, “Retail sales plummeted 8.7 percent from March 2019, the worst monthly decline ever.”

It’s hardly surprising, given that by March the country was heading into shutdown and most stores, in particular, were being closed. And with unemployment skyrocketing, it further stood to reason that consumers were buying less.

What’s equally clear is that, whenever the pandemic subsides and the stores reopen, retail is likely to look much different than it did a few months ago.

But what might the “new retail” look like? “We’re already seeing the new ways we engage in retail spaces,” says Jay Highland, Chief Creative Officer and Managing Director at Chute Gerdeman (Columbus, Ohio). “Physical movement is changing. New queue lines and one-way aisles, drive-throughs and curbside pick-ups, designated entrances for entering and exiting, choreographed shopping routes instead of meandering around the store, surfaces that are non-absorbent and easily cleaned – those are examples of how the physical nature of stores has already changed very quickly, and might be part of a new normal.”

Photography: Kate Testa, Offbeat Productions, Holmdel, N.J.

Photography: Kate Testa, Offbeat Productions, Holmdel, N.J.

Going forward, Highland says he can’t fathom people allowing themselves to be jammed into lines or crammed into tight spaces or even touching and shaking hands as much as before.

Will big box need to be as big? Will lifestyle centers, which were places of over-stimulation, be smaller and with fewer options? Will showroom formats thrive even more than before?

“We predict that the pandemic trends will not go away entirely,” says Highland. “As human beings, we’ll shop and engage in spaces differently. I don’t know that we’ll ever experience movies or sporting events or concerts or museums or restaurants the same way we always have. And almost certainly, retail will be different going forward.”

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Photography: Kate Testa, Offbeat Productions, Holmdel, N.J.

Metroburbs

One new form of a novel shopping environment is the “metroburb” concept being rolled out by developer Ralph Zucker of Somerset Development Co. (Holmdel, N.J.).

The concept, which Zucker defines as a self-contained metropolis in a suburban setting, starts with vacant, architecturally inviting buildings like the Eero Saarinen-designed Nokia Bell Labs research facility in Holmdel and the historic AT&T headquarters campus in Hoffman Estates, Ill.

Photography: Kate Testa, Offbeat Productions, Holmdel, N.J.

The projects – called Bell Works – feature large, city-type pedestrian streetscapes on the ground floor of multi-story commercial office buildings, all under one roof. In the midst of all this is a large piazza with benches and dining tables, indoor and outdoor recreational areas (Zucker installed an indoor basketball court in the Holmdel development), a rooftop social area and even hotel rooms when the economy is back on its feet. But it’s the street-front-style retail that’s the critical element as an amenity to the employees who work in the upstairs offices, as much as to the public at large.

The retail mix focuses on services and experiences, such as a “boutique fitness studio,” real-life gaming and an indoor golf facility, plus medical and dental, food and coffee shops, a bank, a florist, a salon, a weekly fresh farmers market, the Holmdel Public Library and an early-childhood Montessori School.

“Our retailers are mostly local specialty shops and chains,” says the project’s creative director Paola Zamudio, Founder of NPZ Style + Décor (New York). “They don’t compete with national brands or online retailers. Bell Works has become a destination for activities and socializing as well as for shopping.”

Photography: Kate Testa, Offbeat Productions, Holmdel, N.J.

Given current circumstances, Zucker is introducing revenue-sharing arrangements rather than monthly rents for retail tenants in his new Chicago-area facility and will talk to his New Jersey retailers about percentage-rent leases, to help them recover from pandemic restrictions.

“We need our retailers as a key draw for the employees of office tenants who consider coming here,” says Zucker, whose masterplan is to expand this concept around the country. “Otherwise, we’re just another suburban office building.”

In today’s challenging and changing retail world, nobody should want to be “just another” anything.

PHOTO GALLERY ( 11 IMAGES)