The rise of e-commerce has created a raft of cultural shifts that are ongoing and profound—Chicago real estate is certainly one of them. One ripple effect may be expected from an industry that touches us all: the restaurants. It’s a ripple that’s just beginning to be felt in some areas—but may ultimately touch Chicago real estate. According to the Wall Street Journal, “as e-commerce expands into food delivery, new bets are being made on real estate.”
Traditionally, except in the most heavily-populated urban areas, regular restauranteurs have put little to no emphasis on food delivery. Although more common in Manhattan, Chicago or San Francisco, in most places, offering a delivery option was at best a financially break-even proposition. But e-commerce has begun to change that.
As mobile apps and one-click delivery options have skyrocketed in popularity, the revenue potential has become ever clearer. But more than that, now a growing number of restaurants are seeing a new possibility. Why pay for an expensive street-facing retail space in a trendy neighborhood if you could avoid it? Couldn’t you operate your kitchen from a less expensive warehouse district? In other words, if the demand is great enough, why not go all-delivery? The economies are undeniable—especially since it involves dispensing with the payrolls of greeters, servers, and a good deal of associated support staff.
The phenomenon has yet to displace restaurants in a major way—and it certainly will never compete with the entertainment value that an evening out at a fine restaurant will always provide. But just as e-commerce has turned the taxicab business upside down, it might not be surprising if the e-commercial revolution winds up allowing a significant number of restauranteurs to focus their efforts toward out-serving their loyal followers. The Journal even reports the advent of startup companies opening shared kitchen in industrial buildings devoted to “liberating” restaurants from their storefronts.
For local homeowners, the effect on their own Chicago real estate might not be affected by this particular cultural shift—except for the possibility of having a variety of delicious restaurant meals available at our doorstep for a reasonable price.
Chicago real estate is changing fast, too. I hope you’ll give me a call with any and all of your real estate queries!