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Online shopping doesn’t have to be bad news for brick-and-mortar retail, Brixmor Property Group CEO James Taylor told CNBC’s Jim Cramer on Thursday.
That is why the real estate investment trust, which operates open-air shopping malls across the country, has turned some of its prime space — close parking spots — into places for people who ordered online but want to pick up in store, Taylor said.
“We dedicate a few parking spaces, right out in front of the store,” Taylor said on “Mad Money.” “The retailers who get it, who really understand how their customer wants to be served, do a great job at it, and they’re seeing growth in their sales through it. Whether it is Kroger, Walmart, many others.”
Taylor said this concept translates really well to the kind of centers that his company has — more so than traditional shopping malls.
“It works in the open-air center,” he argued.
Brixmor Property Group, which is based in New York City, has more than 400 open-air shopping centers in its portfolio, covering more than 72 million square feet of retail. Its stock has risen more than 47% year to date, closing Thursday at $21.63.
Taylor said a key to succeeding in today’s current retail landscape, which is marked by continued disruption from technology and shifting consumer preferences, is by remaining important to the communities you serve.
Brixmor Property Group does that, Taylor explained, by finding places to strategically raise rent.
“When you come into a period of disruption as we are, and you have reasonable rent bases and you can increase the rent and still offer a tenant a reasonable cost of occupancy, that is how you make money,” Taylor said.
In addition to driving growth in cash flows, it also generates “wonderful opportunities to creatively reinvest in these shopping centers and make them more relevant to the communities they serve,” Taylor said. “And we’ve been doing that very actively.”