Why the retail commercial real estate sector is back | Michael Chen, Madison International Realty
Michael Chen believes retail is back. "Five years ago, the view was that retail was dead and that no one was ever going to buy anything in person," he said during the AFIRE Winter Conference in Miami. But today, as e-commerce sales soften post-pandemic, and the demand for retail space increases in urban areas, the sector is slowly getting back on its feet, one sale at a time. "I think [retail is] actually hitting an inflection point today," Chen said.
Chen attributed his prediction to the lingering effects of COVID-19. During the pandemic, 17% of total retail sales were e-commerce. Today, the percentage has shrunk to 15%. "That's actually not as dire as people thought it was," Chen said.
Retail's resurgence has a lot to do with remote work, according to Chen. "People [need] places to get coffee, maybe even having lunches," Chen said, "All that creates a great dynamic... [It's a] fundamental [rule of] real estate: follow where the people are and go where there's not a lot of supply and... you can do okay."
Michael Chen serves as Managing Director, and Head of Capital Markets and Investor Relations at Madison International Realty. Primarily responsible for developing and executing Madison's fundraising strategy, Chen also serves as a liaison with the investor community. With over 15 years of experience in real estate finance, Chen maintains an extensive network of global investors.
At Madison, Chen is responsible for over $5 billion of equity raised for its sponsored vehicles. In addition to being an active member of various global private real estate organizations including the Association for International Real Estate Investors (AFIRE), Pension Real Estate Association (PREA), European Association for Investors in Non-Listed Real Estate Vehicles (INREV), Asian Association for Investors in Non-Listed Real Estate Vehicles (ANREV) and Institutional Real Estate, Inc. (IREI), Chen is a current Editorial Board Member of IREI Americas, a former due diligence committee member of INREV and a member of the International Affinity Group of PREA. Chen graduated with a BA from the University of Michigan and received an MBA from the University of North Carolina.