In an effort to explore the impact of Amazon.com on brick-and-mortar retailer Best Buy, Suzanne Mulvee, senior real estate strategist with Boston-based Property & Portfolio Research, a CoStar company, created a graph that translates Amazonâ€™s share of the electronics market into square footage. It turns out the online retailer has grown its footprint from one seventh of Best Buyâ€™s store fleet to the equivalent of approximately 50 percent of its store fleet, or 20.1 million sq. ft., in just four years.
â€śUnder the old paradigm, the strength of your real estate mattered: if you had better-located stores, especially in supply-constrained markets, then youâ€™d be insulated from new competition,â€ť Mulvee writes. â€śUnder the new paradigm, high-priced infill locations in Manhattan or San Francisco can be just as easily challenged as greenfield locations in Texas or Phoenix. In the Best Buy-Amazon battle, itâ€™s as if Amazon has a store directly across the street from every Best Buy.â€ť