The Future Of Physical Retail Is Bright (If We Play Our Cards Right)

North American retail is entering a new phase – one where physical stores are no longer relics of a pre-digital era, but the backbone of modern retail performance. With 80% of transactions still taking place in physical environments, stores remain central to revenue generation and customer experience. Even after years of e-commerce growth, most retail still happens face-to-face, on the shop floor.

But this resurgence is creating tension across the sector. Stores are now expected to function as service hubs, fulfillment centres and data platforms, often all at once. At the same time, much of the industry’s physical infrastructure, leasing models and operating playbooks were designed for a simpler era. As service demand rises and staffing pressures persist, many retailers are being pushed to do more with buildings and systems that were never intended for this level of intensity. The result is a growing gap between how retail operates today and how it is structured behind the scenes.

This shift is also changing how retail assets are being valued and financed. Investors are no longer treating physical stores as inherently fragile or short-term plays. Instead, capital is increasingly flowing toward grocery-anchored, service-led and right-sized formats that deliver reliable footfall and repeat visits. These assets are being underwritten as resilient, income-generating infrastructure, valued not just for current cash flow, but for their ability to adapt over time. Data visibility and upgrade potential are becoming just as important as location and tenant mix.

The next generation of retail facilities will look very different from traditional stores. Future-ready sites will operate as integrated platforms, combining modular layouts, connected building systems and centralized performance management. They will support continuous fulfilment, rapid reconfiguration and real-time decision-making, allowing operators to respond quickly to changing demand. In practice, this means stores that can flex with seasons, weather patterns, community needs and even specific times of day or days of the week, all while relying on fewer on-site resources.

Our new report explores how retail brands and occupiers, owners and technology providers are navigating this structural reset. It examines where today’s operating and investment models are colliding, how underwriting is evolving and what ‘future-ready’ retail really looks like in practice. Together, these insights show why physical retail is being redefined as critical economic infrastructure – and what it will take to sustain its momentum in the years ahead. If the industry gets this right, today’s investments could secure the relevance of brick-and-mortar retail assets for decades to come, turning stores into durable platforms rather than disposable formats. The future of retail won’t be decided at checkout, but in how well today’s stores are designed to evolve.

For a deeper look at the forces reshaping North American retail facilities, read the full report here: Future Of Retail Facilities (North America).