Jacob Ryan featured in Wealth Management Magazine: Will the dark store distribution strategy survive past the pandemic?

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Jacob Ryan –
Investment Sales Broker

TULSA, OKLAHOMA (November 2, 2022) - During the pandemic-influenced closing of many retail locations, e-commerce sellers pounced to reposition dark stores in urban locations as mini warehouses. But an improving position of strength in the U.S. retail sector has translated to more in-person shopping, this strategy warrants another review.

“In-person retail is back,” Jacob Ryan, investment sales broker in Northmarq's Tulsa office, told Wealth Management Magazine. “Consumers emerged from the pandemic in a big way, and discretionary spending data supports that. The in-store experience provides us the touch and feel that we all desire.”

Who's occupying dark stores?
Tenants using dark-store space as distribution facilities are usually retailers that have a large e-commerce platform of their own or have partnered with a third-party e-commerce operator, according to Ryan. The pandemic accelerated the demand for direct-to-consumer delivery at a record pace, requiring retailers to quickly find ways to cut costs and get products into customers’ hands as quickly as possible.

“The most logical place to turn was to start leveraging assets already under their control and converting under-utilized retail space to distribution and logistical support square-footage,” Ryan noted.

Other topics highlighted include:

  • Demand for dark stores
  • Industrial growth versus retail growth
  • Community concerns regarding dark stores

Read the full story.

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