Property Profile: Lowe’s
Specializes in providing actionable insights into the commercial real estate space for investors, brokers, lessors, and lessees. He covers quarterly market data reports, investment strategies, how-to guides, and top-down perspectives on market movements.
Missing the one socket needed to fix that last project on your to-do list? For most consumers, going to Lowe’s is as common as a trip to their favorite fast-food restaurant but with far fewer calories.
Lowe’s is one of the easiest examples of what a “big box” home improvement store should look like: emphasis on variety without too much variety and emphasis on great prices without struggling to meet shareholder expectations for profit.
Lowe’s History and Its Position in the Marketplace
Looking at a Lowe’s in Clarksville, TN? You’re looking at one Lowe’s location out of 2,200 across the United States.
The company got its start in 1921 in North Wilkesboro Hardware. The company was founded by L.S Lowe and later passed to his son, Jim Lowe. Jim Lowe took over in 1940, forming a partnership with his brother-in-law, Carl Buchan.
Predicting Demand for Home Improvement Products
However, Carl Buchan saw that the aftermath of WWII meant that the consumer demand for home improvement products would only skyrocket and opted to shift the company’s focus to only home improvement.
In 1952, he would become sole owner and focus on making Lowe’s into a national brand.
The milestone numbers for Lowe’s speak for themselves: the company hit one million customers in 1964 and hit $1 billion in revenue in 1982, with a profit of $25 million.
The company launched its online site back in 1995 to offer a digital storefront, and they have only continued to grow from there.
The Demand for Home Improvement Materials Continues to Rise
The post-pandemic era has launched a deeper demand for home improvement materials and tools and access to assistance. Gardening has become an important tool of resistance and American resilience.
As people began to practice social distancing, they searched for things that they could work on away from others.
Home improvement, gardening, landscaping, and renovation work all work together to improve home values as well as to build equity in secondary properties.
According to market research group Brandessence, the home improvement market grew to over $798 billion in 2021. It’s expected to cross the trillion-dollar mark by 2028.
Retail Is Still a Viable Asset Class in 2022
The search for the ideal asset class within commercial real estate continues, but the truth is that the right verticals depend on short and long-term business objectives rather than any "magic formula."
For example, retail is often dismissed as being too risky when the reality is that retail is still a viable strategy.
Why? In a word, retail is easy to explain from the 50,000-foot view. It doesn’t require explaining the basics because the basics are straightforward.
Something is offered for sale, and consumers can either purchase what’s available or go to an alternative source for the product.
This type of simplicity sets the stage for retail to remain a viable strategy for entrepreneurs and others within the commercial real estate space. There’s no time like the present to look at the success behind Lowe’s in Clarksville, TN, and beyond.
Setting the Stage for Better Acquisitions From the Beginning
Picture the ideal retail space for your short and long-term objectives. What does it look like? If you’re not thinking about space with an anchor store within it, you’re not setting the stage for better acquisitions.
In the long term, acquisitions should benefit your objectives from day one and be useful for resale sometime in the future.
How can you set the stage for great acquisitions? Looking at anchor clients like Lowe’s makes a difference.
The Power of Brand Recognition
The brand recognition behind Lowe’s and its marketing reach are high enough that Lowe’s shoppers will visit other stores to increase their overall shopping experience.
Think about it: when was the last time you drove out to one store and then returned home? This is the same effect but on a system level rather than an individual one.
Do Consumers Truly Want In-Person Shopping?
What makes Lowe’s so appealing, even in uncertain times? The answer is simple: convenience. With so many stores across the US and beyond, Lowe’s is easily accessible.
The open format of each store lends itself well to having customers go in, find what they’re looking for, and browse for other things of interest.
Add in clearance finds, helpful customer service personnel, and space focused on the needs of both retail and contractor customers, and it’s clear that Lowe’s does indeed understand the many market segments it serves.
Setting the Course for Great Acquisitions
Retail isn’t going anywhere, not as long as people want to stop in, touch the things they want to buy, and test them out.
Or perhaps they simply don’t want to wait for two-day shipping. While one-day and even same-day shipping is possible, supply chain delays threaten to push these back further and further.
When shoppers need something for a project that they’re actively working on, the chances are good that they want to go ahead and go to the store and get it.
Studying these property profiles is a wise idea for anyone involved along the greater commercial real estate spectrum, even if acquisitions aren’t the top priority.
The Future and Economic Outlook for Lowe’s
Lowe’s isn’t going anywhere, which may feel like a bold claim in retail.
However, it’s clear that Lowe’s is embracing not only market trends, but they are continuing to support their stores in a way that helps them stand above the uncertain waters of retail as it is today.
The company is dealing with supply chain issues just like any of its competitors, but the reality is that once the market settles, Lowe’s will continue to provide a place where people can go for same-day home improvement products.
This property profile becomes a great reference for not just Lowe’s but examining the retail industry and how it impacts upcoming retail space acquisitions.
While retail still presents challenges to companies of all sizes, it’s clear that it is still possible to succeed.
List & Browse Retail Space for Free on MyEListing.com!
You can list and browse retail space for free right here on MyEListing.com by creating a free account. You’ll also get unlimited access to accurate local market intelligence, local demographics reports, comp software, and more.
Other recent articles
Article Search
Share
All Article Categories
