In a move to attract tech-savvy millennials and affluent baby boomers, commercial real estate developers are bringing office space and residential living space to retail centers such as South Jersey retail space, completely changing the long-standing design of lifestyle centers and traditional malls in the U.S., according to a report from the CoStar Group.

These days, the report said, mall and lifestyle center developers are just as interested in landing solid anchor tenants such as multi-screen or IMAX cinemaplexes and Apple Stores as they are in introducing creative office space and apartments to their multi-million-dollar retail projects.

The driving force behind these changes is an effort to attract the millennial generation’s 80 million consumers, the largest and fastest-growing retail segment in the U.S. economy.  While millennials still lag behind baby boomers in terms of the greatest retail buying power, they nonetheless wield considerable influence on the industry.

Seeking to replace dollars lost to online shopping, national and South Jersey retail space developers are hoping to create new income streams by mixing office and residential space into malls and lifestyle centers to create mixed-use projects that will appeal to the multi-tasking nature of millennials.

Millennials — the generation born in the mid 80s and roughly 20 years after — are considered social individuals who desire walkable, mixed-use environments that allow them to accomplish multiple tasks and activities in a single outdoor location.  That might mean stopping at the gym, the grocery store, a restaurant, a movie theater and more, all in one place.

Projects under construction in several locations now are mixed-use, open-air malls to which office space, residential units and even hotels will be added down the line.  While these projects are new construction, some developers are looking at bring the mixed-use concept to existing retail centers.

These new mixed use projects operate as both the commercial and the social and civic centers of the community, with outdoor public space that follows the design principles of traditional urban planning, one developer said.

Figuring out whether a mixed use center or a more traditional lifestyle center is best for a community comes with understanding the community’s demographic and economic base and knowing what customers want.

The myth that millennials are hip, urban dwellers is dispelled by the Urban Land Institute’s finding that only 13 percent of Gen Yers live in or near downtowns.  The majority live in neighborhoods in cities or in the suburbs, which stands to reason since the oldest — and most influential millennials — those now in their mid to late 30s — beginning to have children and create households.  About 35 percent of millennials own their own homes.

While the focus now is on lifestyle centers and malls, these changing demographics also may soon have an impact on the traditional suburban office park.  As office park tenants search for new ways to attract employees in their 20s and 30s in an increasingly competitive job market, they are looking to their landlords to make the suburban workplace more appealing by adding residential living space and retail space to create the multi-use environment millennials want.

For more information about South Jersey retail space or other South Jersey commercial properties, please call Jason Wolf (856-857-6301; jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a premier South Jersey commercial real estate brokerage firm that specializes in retail space in South Jersey.

Wolf Commercial Real Estate is a South Jersey commercial real estate broker that provides a full range of South Jersey commercial real estate listings and services, marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other South Jersey commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a South Jersey commercial real estate broker that specializes in South Jersey commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking retail space in South Jersey with the South Jersey commercial properties that best meet their needs.  As experts in South Jersey commercial real estate listings and services, the team at our South Jersey commercial real estate brokerage firm provides ongoing detailed information about South Jersey commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for retail space in South Jersey for sale or lease, Wolf Commercial Real Estate is the South Jersey commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and South Jersey commercial properties for lease or sale through our South Jersey commercial real estate brokerage firm.

Retailers in the U.S. and South Jersey retail space markets are finding themselves in a struggle to strike a balance between online expansion and new store openings to fuel future growth, a new retail market analysis concludes.

In the new world of retail marketing in the U.S., retailers concerns about how to fund their growth are running high, according to BDO USA’s ninth annual analysis of risk factors noted by the 100 largest U.S. retailers in their most recent annual reports.  This concern comes in the face of solid year-over-year industry performance, positive sales projections, strong consumer confidence and other positive economic indicators.

BDO reported that 92 percent of U.S. companies identified risks in domestic growth and expansion this year, up from 56 percent in 2013. Retailers in the U.S. and South Jersey retail space markets remain determined to steadfastly increase sales and strengthen store brands, they also understand that their customers want online shopping choices and the convenience of omnichannel platforms.

The focus of investing primarily in new store openings went by the wayside in 2008 when retailers saw their return on investment in new stores drop as more and more consumers turned to online shopping, BDO said.  As a result, retailers slated a higher level of capital expenditures for future growth through online sales, supply chain networks and systems implementations, acknowledging that these new, unproven investment strategies carried a higher degree of risk.

In this challenging new world of retail marketing, retailers are at different stages of funding omnichannel growth.

Wal Mart Stores, which operates 4,500 stores in the U.S. and 2,120 others globally, spent nearly 40% ($5.1 billion) of its fiscal year 2014 capital expenditures ($13.1 billion) on new store expansions and store relocations.  But that amount declined to $4.1 billion or about 34% for the fiscal year that ended January 31, 2015, BDO said. Meanwhile, the big box retailer’s capital investment in information systems, distribution, digital retail and other omnichannel expenses rose from $2.5 billion (20%) to $3.3 billion (27%) over the same time period.

Conversely, Macy’s Inc. — which operates 823 stores in 45 states, making it the nation’s biggest department store chain — is dealing with stumbling blocks as it introduces its new omnichannel marketing plan.

Macy’s invested about $1.1 billion in its last fiscal year primarily on new stores, store remodels, store maintenance and the continuing renovation of Macy’s Herald Square in New York, the company’s flagship store.  And new stores remain an important segment of the retail giant’s growth strategy, with plans in place to open eight new Macy’s or Bloomingdale’s stores in the next four years in Hawaii, California, Connecticut, Florida and Puerto Rico.

Macy’s reported a drop in first quarter 2015 sales, down 0.7% from a year ago to $6.232 billion, while also noting an increase in expenses, up 1.2% over the past year.  The company blamed some of the higher expenses on the ongoing launch of its major omnichannel initiatives that are meant to encourage sales growth and enhance consumers’ online, mobile and in-store shopping experiences.

Macy’s omnichannel marketing strategy remains a key corporate goal, but the company concedes the learning curve was “steeper than we had expected.”

Retailers in nationwide and South Jersey retail space markets have devoted major capital expenditures as well as significant amounts of time and energy to expand their omnichannel sales prospects.  But only 16% of retailers are able to profit from fulfilling omnichannel demand, blaming the high cost of order fulfillment for reducing margins, a new survey conducted by PwC for JDA Software finds.

Nonetheless, retailers said omnichannel fulfillment was a high or top priority and have earmarked an average 29% of this year’s total capital expenditures on expanding omnichannel fulfillment operations.

For more information about retail space in South Jersey or any South Jersey commercial properties, please contact Jason Wolf (856-857-6301; jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a premier South Jersey commercial real estate broker with expertise in South Jersey retail space.

Wolf Commercial Real Estate is a South Jersey commercial real estate brokerage firm that provides a full range of South Jersey commercial real estate listings and services, marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other South Jersey commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a South Jersey commercial real estate broker that specializes in South Jersey commercial real estate listings and services, provides unparalleled expertise in matching companies and individuals seeking retail space in South Jersey with the South Jersey commercial properties that best meets their needs.  As experts in South Jersey commercial real estate listings and services, the team at our South Jersey commercial real estate brokerage firm provides ongoing detailed information about South Jersey commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for retail space in South Jersey for sale or lease, Wolf Commercial Real Estate is the South Jersey commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.