In a Law360.com article published on December 23rd titled “4 Areas of Retail Real Estate to Watch in 2016,” Andrew McIntyre of Law360 writes about the changes we will see in retail in the new year.
The four developing areas are:
- Unlocking Additional Value
- Moving to Smaller Spaces
- Opening new categories of restaurants
- Tinkering with the Apple Store model
Simon Adams of the San Francisco office of Reed Smith commented on the growing trend of retailers to unlock value from their real estate holdings, aided by a broader definition of real property by the Internal Revenue Service. “A retail trend that should come to fruition in 2016 will be the release of capital from certain big-box retailers that have traditionally owned their real estate.” “The declining brick-and-mortar sales due to online retail completion will result in retailers such as Macy’s and others answering to shareholder pressure to unlock that value.”
McIntyre notes that Sears completed a REIT spinoff in 2015 with the creation of Seritage Growth Properties although Macy’s decided against a REIT creation.
The full text of the article can be found here.