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SAN DIEGO—Retail real estate developers will have to adapt quickly in order to stay in the game by choosing tenants who are online resilient, adding stores within stores and using service-based concepts with no inventory, said panelists at the “Changing Face of Retail” event hosted recently by the Burnham-Moores Center for Real Estate at the University of San Diego's School of Business. Panelists included Jim Young, co-founder and CEO of Realcomm; Ryan Perry, senior general manager of Westfield UTC; Stuart Tanz, president and CEO of ROIC; and Anjee Solanki, national director of retail services for Colliers International US.

Moderator Brad Geier, co-managing partner of Merlone Geier Partners, opened up the session by asking, “Why would anyone want to invest and develop retail real estate?” which led to a discussion on the factors currently influencing the market and the transformation of retail space today.

Young described the main elements currently shaping today's retail industry: the desire for human social interaction, the industry's reputation of poor customer service, threats from online retail, inventory issues, obsolete design and the omnichannel—a multichannel approach to sales that seeks to provide the customer with a seamless shopping experience whether the customer is shopping online from a desktop or mobile device, by telephone or in a bricks-and-mortar store. Young pointed out that most individuals would say that the threat from e-commerce is the biggest consideration for future evaluation of retail assets. While only 10% of the market is driven by online sales, this figure is expected to grow substantially over the next couple of years, and this kind of market infiltration will force retailers to change how consumers purchase products.