Service-oriented tenants overtake product sellers at retail centers
Facing competition from e-commerce, retail centers are seeing their tenant mix shift away from products and toward services. According to JLL, service-oriented tenants occupy 52.6 percent of retail space, and product-oriented tenants occupy 47.4 percent. (In 2002, product-oriented tenants occupied 53.2 percent of retail space.)
The largest growth was in restaurants and drinking places, which increased by 155,684 locations — a 30.9 percent jump, reports JLL. Regional malls have been redeveloping vacant department store space into mixed-use concepts including restaurant space, and small chain restaurants have been active in strip centers.
Fitness was another strong category, increasing by 11,173 locations or 44.2 percent, according to JLL. Fitness-based concepts have been a strong tenant for power centers, which have seen growth in large gyms operated by national chains, and strip centers, which have seen expansion from smaller, specialized fitness studios.