This brings me to my investment thesis, granted it's been written before but the general progression of the consumer has gone from main st to big box/malls where you can just get everything done in one centralized locations, this can be malls or marketplace or commons. Now of course, and it has been well documented everything is now moving online, AMZN, NFLX, OSTK, and of course all other corporate websites that you can just go on there and have it shipped to your house in a simple click.
Oil keeps rising, energy keeps rising, costs for employees keep rising, yet shopping with human interaction keeps dropping this is a combination of a bad economy and everyone moving to the net. This should be the way it is, it is the next logical step in the consumer evolution. I'm beginning to wonder in 15-20 years are malls going to be around? Are retail stores going to be around? Will there be storefronts?? Sure some people are going to go out and pick up goods at these places, but will be enough to offset Rent, labor, and energy costs that keep on rising. Will the mall just be one big Apple store, one other interesting fact I witnessed today, it's that half the stores in Short Hills are woman's fashion, usually most stores are that way, but I found this to be more than usual. To me the reason this occurs is basically because woman still shop for sport, it is fun for them as much as it is torture to us, why a majority of us men have turned to online. I was looking for toys for my goddaughter today, no toy stores left, just go to amazon or toys r us.com
This observation leads me to believe that companies like GGP, SPG, CBL are big time shorts over the long term, I can't see where these market forces against them how malls and other commercial real estate properties can maintain. Another big time short to me is GME, I read something recently that video game players can just download games directly onto their game systems, this sounds eerily familiar to NFLX/BBI(BLOKA). If everyone begins to stream their games on, how much business does GameStop lose, probably why their P/E is so low. I think over the long term unless they can transform their business model further I see them being like the company that develop the buggy.
On the long side, AMZN I like with a little bit of a dip, you will see monster numbers come out of them after the holiday season, I also like the companies that help transport the goods, UPS/FDX. If no one is going to the mall, and people are still buying it needs to get there somewhere.......
I'm sure a lot of this article may have been heard before, but take it from someone who was just on the front line , in 10-20 years malls are toast!
