Will Technology be the Death of Commercial Real Estate?

OK, maybe the death of commercial real estate is an exaggeration, but Kevin Drum has pointed out an interesting piece from Salon.com on Amazon’s new effort to create same day delivery for its goods:

It’s hard to overstate how thoroughly this move will shake up the retail industry. Same-day delivery has long been the holy grail of Internet retailers, something that dozens of startups have tried and failed to accomplish. (Remember Kozmo.com?) But Amazon is investing billions to make next-day delivery standard, and same-day delivery an option for lots of customers. If it can pull that off, the company will permanently alter how we shop. To put it more bluntly: Physical retailers will be hosed.

One potential implication: those shopping centers and downtowns that became half-empty during the recession might stay that way (unless, as Mr. Drum suggests, the space gets taken over by our burgeoning health care sector).  Either way, it suggests a tranformation is underway in the commercial real estate market.

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