WHY NET LEASE IS SUPERIOR IN AN OMNI-CHANNEL WORLD

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WHY NET LEASE IS SUPERIOR IN AN OMNI-CHANNEL WORLD

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Contents

03 EXECUTIVE SUMMARY 04 A VISUAL COMPARISON OF FREE-STANDING RETAIL AND TRADITIONAL SHOPPING CENTERS 05FREE-STANDING REAL ESTATE IS THE FUTURE FOR RETAILERS 06 THE DAYS OF GETTING CUSTOMERS IN THE DOOR ARE WANING; VEHICULAR CIRCULATION IS CRUCIAL 10 ABOUT US

A G R E E K N O W L E D G E B A S E WHY NET LEASE IS SUPERIOR IN AN OMNI-CHANNEL WORLD

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Executive Summary

WHAT DO COSTCO, WALMART, TARGET, HOME DEPOT, McDONALD'S, STARBUCKS, TRACTOR SUPPLY AND CHICK-FIL-A HAVE IN COMMON?

They are ALL free-standing (net lease) retailers that control their entire premises, or in common real estate parlance, from "curb-to-curb". Parking configurations, drive-through windows, designated pickup spaces for buy online pick up in store (BOPIS), drive aisles and traffic patterns around their buildings all fall within their leased premises. Compare that to a typical inline tenant in a shopping center or a mall whose premises solely consists of the space within the four walls of their structure. Flexibility is paramount in a dynamically changing world whether a retailer is adding a second drive-through, pickup only spaces, or an additional truck dock for micro-fulfillment. As such, the free-standing format provides the greatest level of efficiency and effectiveness for retailers to transform to meet the changing demands of consumers.

A G R E E K N O W L E D G E B A S E WHY NET LEASE IS SUPERIOR IN AN OMNI-CHANNEL WORLD

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Retail Experience

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As the retail experience continues to evolve, free-standing real estate allows retailers the flexibility needed to adapt and thrive. The Covid-19 pandemic was an accelerant for change and retail real estate was not immune. Retailers who control their real estate from "curb-to-curb" are able to quickly implement things such as contactless pickup, drive-thru/pick-up lanes, and buy online pick up in store (BOPIS). In the early days of the pandemic, the ability to adapt quickly gave retailers a distinct advantage by providing customers the shopping experience of the customer's choosing. Conversely, the traditional shopping center does not provide the flexibility or infrastructure required to support the needs of today's customer.

FREE-STANDING REAL ESTATE

TRADITIONAL SHOPPING CENTERS

FREE-STANDING RETAILERS ARE BEST POSITIONED TO CAPITALIZE IN AN OMNI-CHANNEL RETAIL WORLD

A G R E E K N O W L E D G E B A S E WHY NET LEASE IS SUPERIOR IN AN OMNI-CHANNEL WORLD

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SOURCE: WALMART STORES INC.

Free-standing Real Estate Is the Future for Retailers

As the needs of retailers continue to evolve, the free-standing format provides retailers an unparalleled opportunity for multi-node customer access. With control of their entire premises, retailers can provide the full suite of omni-channel capabilities. This includes same-day delivery, BOPIS, pickup lanes, micro-fulfilment, and other modes of distribution. Net lease real estate provides retailers with full control of their respective parcel, enabling them to evolve their strategy as consumers continue to change their preferences. Case in point: Walmart's addition of online pickup lanes located in their parking lots, which has served to expedite purchasing times1.

A free-standing format permits a retailer full use of their parking lot, which provides additional access points, enhanced customer convenience and better control of the overall consumer experience. Separately, and to be discussed at length in future white papers, this format also allows for integrated supply chain and logistics innovation with property access supporting further flexibility. As such, free-standing retailers are best positioned to capitalize on the continued evolution of retail.

SOURCE: WALMART STORES INC.

A G R E E K N O W L E D G E B A S E WHY NET LEASE IS SUPERIOR IN AN OMNI-CHANNEL WORLD

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