The growth of e-commerce in the past led to a decrease in brick-and-mortar retail presence, but it appears as if the tides are changing in favor of re-investing in the physical retail market. The line between online and physical commerce is beginning to blur, and companies such as Amazon aim to combine their strategies to expand in both markets.

Key findings

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“Land prices are rising rapidly as supply struggles to keep up with rampant demand-especially in dense markets and the hubs that serve large populations.”

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“Distinct development patterns have emerged to support e-commerce fulfillment, and are reflected in the increasing cost of land. In 2017, land prices rose sharply for development of warehouses – both“first-mile” and “last-mile” – due to strong demand and a diminishing supply of viable sites. In the 10 most active warehouse construction markets, rising land prices are contributing to higher rental rates, which remain a small component of total logistics costs.”

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“CBRE estimates that for every $1 billion increase in sales for e-commerce there is 1.25 million square feet of absorption of logistics space…and e-commerce sales grew from essentially nothing to now 8.4% percent of total retail sales by the end of last quarter.”

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