2024 Retail Fit Out Cost Guide

RETAIL FIT OUT COST GUIDE 2024

E-COMMERCE SHARE OF RETAIL REVERTS TO TREND ONLINE AND IN-STORE ARE COMPLEMENTS, NOT SUBSTITUTES

25%

300

250

20%

200

15%

150

Billions

10%

100

5%

50

0

0%

2010 2011

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

2022 2023

E-commerce retail sales, $

Share of core retail sales, %

Pre-Pandemic Trend

Source: U.S. Census Bureau, Cushman & Wakefield Research

RETAIL FUNDAMENTALS

In 2020, with traditional retail stores inaccessible, consumers embraced online shopping to an unprecedented extent and e-commerce sales exploded. Online sales had been steadily gaining ground in retail, but the pandemic markedly accelerated this trend. Three years later, the share of retail sales has returned to its long term growth trajectory. Digital native brands are exploring a presence in physical stores, as price hikes have made profitability increasingly difficult. FedEx and UPS increased shipping rates nearly 6% in 2022, the largest rate increase in almost a decade. Digital advertising costs have risen as well after Apple began allowing users to opt out of data tracking in 2021. Storefront demand has also been fueled by an influx of new discount retail locations from companies like Dollar General, Family Dollar and Dollar Tree. In 2023, estimated net openings for discount stores sat at 1,656. These three discount brands alone will add over 21 million square feet (msf) of retail space in 2023.

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