Investment, REITs and Crime: Will Online Shopper Be Driven To Malls?

Patricia Eisenhauer's picture
Online Shopping and REITs

Real Estate investors and the shopping public (you and I) are witnessing progress.

Whether we approve or not our shopping habits have been altered. The wonderful huge shopping malls that brought in wonderful huge profits are disappearing. Anchor tenants are terminating their leases or merging with other large retail stores. This leads to a lessening of customers for the smaller tenants also. Store fronts are dark and parking lots are emptying. The culprit, of course, is on line shopping.

Office space normally a high profit long term investment is also diminishing. Again computers are filling the “shoes” of actual personnel. Add to that number of workers who have accepted the offer to work from home. Less overhead for employers and naturally less income (actual lease space) for the REIT or single investor.

Just as the individual shop owners of the 1940's and 1950's watched their mom and pop business give way to the malls, so too have the malls become dinosaurs.

Perhaps this is another sign of progress in our country. The profitability in owning such large investments is evaporating. It certainly was much cheaper to repair the electric systems or floors in a general store than a magnificent mall. The return on investment was very good. The return of investment has dwindled or disappeared.

As online shopping becomes more dangerous with hackers and various forms of identity theft , perhaps it will drive shoppers back to the malls. Is it possible that good might come from these crimes?

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