Retail & E-commerce

Industrial land changes: The COVID-19 pandemic resulted in a decrease in demand for commercial and office space in urban areas. At the same time, the demand for online goods also increased considerably, e-commerce sales increased 32% from 2019 to 2020 according to the US Census Bureau. In response to the increasing demand for goods ordered through e-commerce, companies are seeking to build mini distribution centers close to, or in, urban areas to facilitate faster and more deliveries. While this looks like an opportunity to turn an underused space to a useful one, planners need to carefully think if the land is suited for this type of activity before changing land categorization from commercial to industrial. Large trucks can contribute to congestion and produce noise and air pollution.

Commercial land use changes: Big-box stores and shopping malls are expected to close at high rates in the United States as retailers switch to conducting more business online. The numerous vacant spaces provide an opportunity for new kinds of land uses. Mall land is particularly valuable as the land is usually located near major roads and highways and freeways and close to many transit lines, making it well suited for being repurposed into housing or distribution (industrial) land uses.  

Zoning Implications: The distinction between different types of land uses are beginning to blur. Some big box stores, including Target and Walmart, are updating their business model and floor plans to accommodate increases in online shopping. For example, both retailers are prioritizing “buy online, pick up in store services,” dedicating areas of the store and parking spaces solely to this service. Additionally, these retailers are able to use their large physical stores as mini warehouses and distribution centers. While this enables these businesses to stay viable, they are left in a gray area with regards to what type of land they should be zoned under.