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Tenants of the Future: What Concepts Will Demand Space in the 2030s?

January 3, 2024

If tracking new retail concepts is challenging today, how hard would it be to predict the tenant landscape in the 2030s? Commerce + Communities Today asked experts to envision operators that could be leasing space in a decade. Letting their imaginations roam and extrapolating from present-day trends in demographics, technology and consumer behavior, they offered the ideas below.

Cricket, Anyone?

Hundreds of millions in India, South Africa and Pakistan live and breathe cricket, but could a cricket-themed, sports entertainment concept thrive in the U.S.? Gallelli Real Estate vice president of real estate intelligence and business development Garrick Brown had some doubts. “I remember running into some people who were looking to lease space in the United States for a cricket concept,” he recalled. “I was like: ‘You know, maybe you should tweak it and do baseball instead. It isn’t that far off from cricket.’” But as Brown sees it, America’s increasing diversity and the push for variety in live sports programming could put a more international spin on the sports entertainment category in the years ahead.

New concepts based on international sports like soccer, field hockey and table tennis, he noted, could prove popular with immigrants, their descendants and newly initiated fans alike. Brown cited the splash made this year by Argentine soccer legend Lionel Messi and his top-selling pink jersey. “Soccer and soccer stores are taking off in a big way, and you could put a lot of that on Messi,” he said. “I wouldn’t be surprised to see the same thing happen with other international sports.”

Foodie Offerings from New Regions

In a related trend, Brown predicted that rising diversity will help drive the creation of grocery and food-and-beverage concepts around the country. Traditional and fusion concepts from heretofore unrepresented cultures and cuisines should find a passionate audience now that generations of Americans have embraced foodie culture and haute cuisine, he explained. In one example of U.S. palates’ growing sophistication, Michelin published its first Atlanta restaurant guide this past October. “We are a full-on, 24/7 foodie culture now,” Brown said, “but as interesting as things are today with things like Korean corn dogs and Japanese breakfasts, there’s still a ton of space to be explored, all kinds of cuisines from Africa, the Middle East and even Europe.”

Super Ghost Kitchens

Four-course meals at Michelin-starred restaurants are just part of the food-and-beverage spectrum. Futurist.com chief futurist and think tank leader Nikolas Badminton said convenience could become even more central. Thanks to a futuristic logistics network integrated with predictive analytics, driverless cars and autonomous delivery robots, consumers could get food delivered in minutes, negating the need to go to traditional quick-service restaurants. “If you look at both the statistics and what some restaurant industry observers are saying, then by 2030, you could have these ghost kitchens starting to push out QSRs,” Badminton said. “It would be a little rich to say this is inevitable, but there’s no doubt that ghost kitchens are going to get larger and more prevalent.”

In one scenario, “super ghost kitchens” could build or lease cavernous spaces to whip up thousands of menu items on behalf of QSR brands, Badminton said. The Canada-based consultant, who has spoken at ICSC@Whistler, said there could be a downside: “These aren’t going to be places that you can even walk into, and that lower foot traffic is not necessarily going to be great for the overall ecosystem of retail.”

Short-Term Offices

The trend toward hybrid and remote work continues to affect the office sector: According to a February 2023 Cushman & Wakefield report called Obsolescence Equals Opportunity, 1.1 billion square feet of the of 5.7 billion of office space that would exist at the end of the 2020s could be vacant. As Badminton sees it, remote work could be the norm even for medium and large employers. However, companies still will need to gather in person for brainstorming sessions, team-building events, conferences and all-hands-on-deck announcements, he said, and this demand could translate into new types of office tenants. “These would be creativity or productivity centers that companies could lease for anywhere from two or three days to a month.”

The futurist envisions wired, highly customizable spaces packed with amenities. Retail and mixed-use landlords also could do deals with these purveyors of temporary spaces for meeting and working. “If you’ve got 100 people working five days a week in that space for two weeks or what have you, they’re going to need food and other things. You’re bringing these customers right into your retail center.”

Toronto-based StartWell already is making strides in this direction, Badminton noted. The company offers temporary boardrooms, meeting spaces, large-event venues and studios for podcasts, video shoots and livestreams. “So much office space has become obsolete,” he said, “but you could see these kinds of temporary spaces continuing to evolve and get more creative and interesting.”

AI Gadget Stores

A decade from now, artificial intelligence advances could lead to a proliferation of gadgets that either work with or are independent of people’s smartphones, according to futurist Daniel Burrus of Burrus Research. Humane’s Ai Pin is a possible hint of things to come; the wearable device projects an image onto the user’s palm, allowing for AI interactions through touch, voice and gestures.

Stores and kiosks selling such gadgets could drive leasing revenue at marketplaces, Burrus noted, and the devices themselves could transform the in-store experience. In one scenario, some form of earpiece, possibly connected to a small camera, constantly connects customer service personnel to nearly omniscient AI helpers. When a customers asks, “What else would go with this?” or seeks more information about product specs or what’s in stock, the AI would whisper the answer in the salesperson’s ear. “It will be giving [the salesperson] information in real time,” Burrus said. “They will know exactly: ‘It’s over on Aisle 20, and we do have your size.’”

Such a shift could ramp up the performance of inexperienced customer service agents, Burrus said. Shoppers also could use their own AI earpieces to interact directly with store data. “You could walk into a larger retail outlet and, instead of wandering around trying to find someone, just ask where the nearest associate is,” the futurist explained. The AI earpiece could inform the customer that the closest associate is in Aisle 4, he said, and tell the customer: “They’re just finishing up with someone. Would you like to wait or just go meet them?’”

Anti-AI Stores

Some of today’s entertainment tenants are about putting down the smartphone for some in-person social connection and analog fun. That could mean getting together with friends to play retro arcade and pinball machines, break out classic board games or huddle in a listening room with vinyl records and a tricked-out sound system. As trends like AI accelerate, Badminton said, the craving for actual human connection will deepen. “People want to connect in new and interesting ways and be part of a community,” he said. “We’ll see more demand for retail spaces that are human-centric and artisanal.”

Some of these operators likely will focus on niche communities, such as fans of certain social media influencers, nostalgic movies or TV shows, Brown added. The launch of Central Perk Coffee Co., a replica of the hangout from the 1990/2000s sitcom Friends, is a present-day example, he said. “Their strongest demographics are Millennials and Gen Z.”

Other consumers may reject interacting with AI helpers or shopping empty, cashierless stores that have a “post-apocalyptic feel,” Badminton said. Operators could cater to this group by banning in-store AI and hiring friendly, competent and sincere staff. “You could see stores having a sign: ‘We’re a proudly human-run business.’”

By Joel Groover

Contributor, Commerce + Communities Today

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