Sears, Amazon, Sears Sears discussed on Think Realty Radio
Right. And what you see this concept of the last mile, right? There's a lot of a lot of talk about this the idea that like already there's a lot of products on Amazon you can order that will be at your door in the same day. Okay. And what they're moving towards whether it's Uber, Amazon or others. They want to figure out how to make it. So that when you order something online or better yet when you're out of something before you even know you're out of it like I buy ketchup every five weeks it's week four and a half. Catch. It's gonna show up at my house. That's where we're going. And so what it means to retail is that the retail store the place that you used to go the last mile meeting how to get it from distribution center to your door that last mile used to be you, right, Abby. You would stop and pick up catch. Chip. And you'd bring it the last mile from the convenience store or the supermarket near your house, and what Amazon and others are now doing is saying, hey, you don't have to do anything. You can order it over just. We'll just no you need it. Like, a smart fridges are coming where when the ketchup is out. They know in the milk is added knows it. That's all coming. So what happens to the retail real estate? It changes. Okay. Where you may not go in anymore. But there's still has to be real estate close enough to where you live that there are certain things perishable that if you want them they've got to get them to you. So we're starting to see a change in mindset where real estate that could be utilized to store the things that used to be picture seven eleven that. You don't go inside of anymore. You gas up but inside the seven eleven it's still the stuff you used to buy from seven eleven, but it gets brought to you by somebody. Who's an Uber delivery person picks it up there and brings it to you. Okay. This is what the talk of what's happening in retail is even though how you get. It is going to change the fact that it has to get to you doesn't change. How it gets to you? Maybe you, and maybe somebody else it, let me be a drone delivers it, but there's still has to be ketchup and milk near enough to your home catches, a bad example because not perishable, but has to it has to be lettuce and bread and milk. Right. There can still get to you. And so I think that from that standpoint. It's a riskier play to by the retail real estate. But I'll tell you what I'm doing. I'm buying real estate on buying single family rentals near the new Amazon distribution center this being built in Charlotte. So I know that that's retail essentially because retailers changing, but what's happening is creating jobs in and around the distribution centers for my investments are shifting from more, outward suburbs down to be tight near those distribution centers. Because I know they could add twenty five hundred jobs right near the distribution center on buying real estate. You can ride your bike to work from. That's right. So how do you think? How does the chapter eleven filing by Sears effect? This overall strategy. I think when you see Sears, and you see toys R us and you see blockbuster video. These are all examples of companies that didn't shift fast enough. Okay. They just didn't change fast enough. I don't I don't know the inner workings of Sears as well as I know what happened to me blockbuster video is a sad story because they just got eaten alive by net flicks. That's right. At literally what they, but they were saying back when this was all happening is they were Scoffing and laughing and death lakes and saying no one's going to do that. They like coming into the store. Right. No one. Let's go into the store. They like pushing one button and getting access to the movie. So, yeah, it's awesome. The reason why like red box didn't didn't take off same thing. Yeah. I would hate to be in that business. My actual response to this question is this is why I love real estate because I have a quick enough guy. But I'm not quick enough to figure out how people are going to watch their TV shows like if I were net flicks. I wouldn't be comfortable because you know, what? There was a time not long ago that I remember that nobody even heard of that before somebody's gonna come along and eat their lunch. Also, potentially what I like is things that don't really ever change people. Even if the virtual reality means, you never gonna leave home. Well, guess what I want to own a home that you rent, right? So there are certain things that are timeless. Physical real estate is one of those timeless things that play the changes in the shifting market place. Shifting consumer behavior, but one concern behavior that is not going to change his people wanting to live indoors wanted to live in a warm house in the winter and a cool house in the summer, they want if they're going to want to have kids the kids didn't want to play out in the backyard at least once in a while with a dump laid fortnight. So I feel like real estate is the perfect. Hedge against wildly changing consumer behavior because certain consumer behavior just aren't going to change at a lot of those things tilt towards residential real estate because lay their head down at night to go to bed. I feel the same way about Sears. I think the I mean, I have a feeling that they're obviously going to repurpose their stores. Right. Maybe Amazon can use that as a distribution warehouse. That was like a fantasy that I had I thought that would just be the coolest thing ever. So every Sears location becomes like this Amazon pick-up center, I think that would be real they announced it, right? Amazon announced they're opening up stores that are that don't have actually know told me that an Uber driver told me that Amazon announced I saw the story. Five minutes later. They read the story. Amazon is having cashier stores. And the Uber driver was mad about the cashiers losing their jobs, and I didn't say because I was in the back of her car was gonna mention what about those cab drivers that you can took their job away. But okay, whatever. Yeah. The stuff changes. I think that it is a really interesting time to be alive and consumer you might be right for except that fits in. With my thesis that retail real estate like Sears. Stores. Here's the problem with Sears stores. They bought them. They bought the real estate Sears owns a lot of the stores that actual physical stores that they used to occupy now the retail model that bought those stores based on is becoming obsolete. And so the value of those stores as retail Alice, Michael Bye-bye, they will might wind up being warehouse facilities that have a pickup element to them. The real estate will still be valuable probably not just probably just not as valuable as what Sears paid for them. Yeah. I also think some of these shopping centers, for example, if you go to these major clothing stores, I think what's going to happen with them is they're not going to have as much. Product stocked. That's that's all going to go away. And instead you'll have a bar. You'll have an experience at sea. Macy's and you'll find a couple of your sizes the try on if it works, then great. They'll go ahead and ship it for free directly to your house. All in the comfort of having an sipping a cocktail at Macy's. That's when I feel this is going to go to you. I feel like it's going to be very experienced based for people and given that millennials have this yolo you only live once methodology and kind of framework for their world. And the fact that we live in a microwave society, it makes sense. So you know, it's funny, which is heavy you mentioned series. We talked about Sears Sears began as a Cadillac. Yeah. That was where they started. So they began of order the Cadillac liberty your home. They went out and opened up stores. They bought the stores they ended up over leveraging. Maybe the Sears brand will will come back around again as being being a monster aware you buy online and have it delivered. We'll see you know, it's going to see it's going to depend on who takes the range, and whether or not the Sears brand actually means anything anybody anymore. I kind of hope that it will. But.