News Release - 10/18/98

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News Releases - October 18, 1998

A New Sense of Place: INFOTECH’s impact on the HOME explains how information technology is changing the home’s role as an activity center and technology platform. The paper advocates building wired homes in response to market demand and for increasing resale value. The talk given at the Pacific Coast Builders Conference in June analyzed INFOTECH’s growing role in education, shopping and work. Leveraging the value of INFOTECH requires reconfiguring the home and the need to upgrade the wiring. Examples of the home’s changing role include creating a workplace for telecommuting, having a classroom for distance learning and developing a shopping center for online buying. Builders can incorporate the INFOTECH trend by soundproofing the home-office and study area, by installing high-bandwidth telecommunication connections throughout the house and by making the activity center the focus of the home’s design.

The California Real Estate Journal’s June supplement featured an article asking how Internet buying changes the need for store space? The story focused on the Real Estate Transformation Group.

FITCH IBCA, a Wall Street credit rating agency, issued a seminal study on how online shopping can impact retailers and their demand for store space. See Pam Stubing and Mark Swirsky, Impact of Internet Shopping on Retail Trends, Corporates-Special Report, July 9, 1998.

The ICSC Research Quarterly (Summer) published From Full House to Empty House: What Does Movie Theater History Have to Do with Retail Space Demand? by Mark Borsuk. The article discussed the potential impact of Internet buying on retail space demand by comparing the decline of movie theaters with the rapid diffusion of another information technology, Television.

On September 28 Borsuk presented Is There a Joker in Your Store Leasing Strategy?: Online Buying’s Impact on Retail Space Demand to financial executives at the National Retail Federation. The Orlando address discussed creating a wired lease, and the implications of wired households on store-based sales, store locations and profitability. Interestingly, the Wall Street & Retailing panel polled the audience on Internet retailing. Over 90 percent of the 400 attendees expected online buying to impact retailing within five years.

Borsuk also addressed financial executives at the International Mass Retail Association’s conference in New Orleans. The October 9 talk called TOTAL WAR: online buying’s assault on the store emphasized mass merchandisers like Wal-Mart, Kmart and others are at the cutting and bleeding edge of the online buying revolution. Borsuk discussed how “bundle buying", his term for combining the best features of the supermarket, drug store and warehouse club online, would become a formidable competitor to mass retailers within two years. He also advised them to revise store leasing and store ownership strategies in light of online buying’s impact on space demand and store economics.

On October 30 Mark Borsuk will lead a round table discussion entitled Will a Wired World Change Retail Leasing? at the ICSC Law Conference in Nashville.

On November 19 Borsuk will address the Ontario Chapter of the National Association of Industrial and Office Properties (NAIOP) in Toronto on retail property investment risks in a wired world.

The Real Estate Transformation Group advises landlords, retailers and lenders on property strategies for the information age. In addition to consulting, Mark Borsuk is a retail leasing broker and real property attorney practicing in San Francisco.

Contact Mark Borsuk, Managing Director (415) 922-4740 / FAX 922-1485.

mark@borsuk.com

The Real Estate Transformation Group thanks Mihalovich Partners, Commercial Real Estate Services {“http://www.mihalovich.com”}in San Francisco for hosting RETG articles.

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