Food And Beverage Industry Seen As Growth Market In U.S. Retail Real Estate Sector

Aug. 16, 2019

DALLAS, Aug. 14, 2019 /PRNewswire/ -- A healthy appetite for food and beverage businesses continues to fuel significant growth in one of the hottest areas in the U.S. retail real estate sector, according to BBG, a leading due diligence commercial real estate firm.

In U.S. cities across the country, more restaurants, bars and grocery stores are opening or expanding operations to meet growing demand for these services, as a result of an ongoing demographic shift in how and where people live, work and play.

That has led to these businesses growing their share of total retail spending, from 24.3 percent during the past decade, compared with 22.7 percent prior to the 2007-2008 recession, according to one recent industry report. F&B sales now account for nearly one-quarter of all retail sales nationwide.

This trend has brightened an otherwise hazy outlook for retail real estate, which has been hit by rising brick-and-mortar vacancies and a decline in rents. Retail vacancies increased to 10.2 percent the first quarter of this year, compared with 10 percent a year ago, according to a report released by Reis, a commercial real estate data provider.

But many retail food and beverage properties are considered potentially solid investment opportunities, particularly those located in urban areas which are attracting younger workers. This age group is typically single and prefers dining out or take-out food instead of cooking meals at home.

To accommodate this lifestyle, developers are building or renovating more stand-alone F&B spots and mixed-use complexes for urban-dwellers. Restaurants and grocery stores also are expanding their "store-to-door" delivery operations, in order to meet customer demand for fast and convenient service.   

The retail market is not the only sector in commercial real estate that has benefited from the F&B business boom. The industrial market has witnessed growth in the cold-storage warehouse space, driven by more grocery chains launching online delivery services.   

BBG CEO Chris Roach commented: "A resilient economy and changing societal and technological trends have contributed to the food and beverage industry's positive impact on the retail real estate market. We anticipate that the F&B market will stay healthy in the near future, based on current supply and demand projections. With extensive expertise in retail property valuations and related services, along with offices located in all key markets across the country, we are well positioned to assist F&B operators and other retail concerns in achieving their strategic goals in this dynamic market."     

About BBG

BBG offers comprehensive due diligence services including valuation, advisory, property assessment, energy services, and zoning. Headquartered in Dallas, the firm has 35 offices in key US markets and more than 2,700 clients. BBG has achieved a reputation for personal attention, on-time delivery and deep expertise in multi-family, office, retail and industrial sectors. For more information about BBG, please visit