The COVID-19 pandemic brought seismic shifts to global economies, but perhaps few sectors experienced as jarring a transformation as retail real estate. Lockdowns, consumer behavioral changes, and the acceleration of e-commerce upended traditional retail models, forcing landlords, tenants, and investors to reevaluate strategies. Yet, amid the disruption lies opportunity—especially for those focused on adaptive reuse, mixed-use development, and sectors like fitness and service-oriented businesses. David Lawver, founder of Turnkey Ventures, emphasizes that as the dust settles, retail real estate is undergoing a renaissance shaped by flexibility, experiential demand, and tenant diversification.
The Pandemic’s Impact: Shifting Foundations
Retail real estate was already in a state of flux before COVID-19. The “retail apocalypse” narrative, spurred by overbuilt mall inventory and the rise of e-commerce, had already begun to erode the dominance of traditional brick-and-mortar spaces. David Lawver, founder of Turnkey Ventures, explains that the pandemic acted as an accelerant. In 2020 alone, more than 12,000 retail store closures were recorded in the U.S., as major retailers like J.C. Penney, Neiman Marcus, and Pier 1 filed for bankruptcy. Indoor malls, in particular, saw foot traffic plummet as consumers turned to online platforms for everything from groceries to luxury goods.
Leasing activity stalled, vacancies spiked, and landlords faced rent collection challenges. The ripple effect was felt across urban cores and suburban shopping centers alike. David Lawver explains that these same conditions sparked creativity, with many property owners exploring new uses for vacant spaces or reevaluating their tenant mix to create more resilient, experience-driven environments.
The Rise of Omnichannel Retail and Experiential Tenants
Post-pandemic, successful retailers are those that embraced omnichannel strategies. Curbside pickup, BOPIS (buy online, pick up in store), and localized delivery have become standard. Retailers are no longer choosing between brick-and-mortar or digital—they are doing both, in sync. Consequently, physical locations are evolving from pure transactional hubs into brand experience centers.
David Lawver, founder of Turnkey Ventures, understands that this shift has implications for real estate design and leasing. Retail landlords now seek tenants that enhance foot traffic and engage the community, including experiential concepts like escape rooms, immersive art installations, and social food halls. The pandemic reminded landlords that retail must offer something that cannot be easily replicated online—a reason for consumers to leave their homes.
Fitness and Wellness: Anchors of the New Retail Mix
One of the most significant growth areas in the retail real estate market is the fitness and wellness sector. During the pandemic, gyms and studios faced significant closures, but the resilience of health-conscious consumers has fueled a powerful comeback.
Brands like Planet Fitness, Orangetheory, F45, and boutique yoga or Pilates studios are aggressively expanding, often filling former big-box vacancies. Fitness tenants are ideal for retail centers because they drive consistent, recurring traffic and complement surrounding businesses like juice bars, cafes, or athleisure retailers. Some fitness brands now offer hybrid memberships that combine in-person classes with digital access, further enhancing customer retention and value proposition.
Wellness services such as physical therapy, cryotherapy, IV lounges, and med spas are also on the rise. David Lawver explains that these services thrive in retail settings due to their customer-facing nature, steady demand, and lack of reliance on impulse shopping. Developers and landlords increasingly view these tenants as stable, long-term occupants capable of enhancing the overall health of a retail center.
Service-Based Tenants as a Resilient Growth Engine
While traditional retail categories like apparel and electronics face ongoing competition from e-commerce, service-based tenants remain a pillar of in-person commerce. Salons, dry cleaners, pet groomers, repair shops, and co-working spaces provide essential, non-replicable services that draw consistent foot traffic. David Lawver emphasizes that their resilience was tested during COVID, and many emerged stronger thanks to their hyperlocal customer base and adaptability.
From an investment perspective, properties anchored by service-based tenants often offer more stable cash flow and lower volatility. These businesses are less sensitive to the e-commerce disruption and often sign longer leases, making them attractive to both institutional and private investors. Medical and dental practices, urgent care centers, and veterinary clinics are also finding a home in retail environments, benefiting from high visibility and easy accessibility. This “medtail” trend is transforming shopping centers into community wellness hubs.
Challenges Still Loom: Inflation, Labor, and Evolving Consumer Habits
Despite the optimism, retail real estate in the post-pandemic world faces enduring headwinds. Inflation and rising interest rates have impacted consumer spending and developer financing. Construction costs have surged, and skilled labor shortages add complexity to redevelopment projects.
Changing consumer habits continue to influence space utilization. Many consumers still prefer the convenience of home delivery, while younger generations seek socially conscious, experience-rich retail environments. Developers must walk a fine line between innovation and overreach, ensuring that retail centers meet community needs without becoming over-programmed or niche.
David Lawver explains that not all geographic markets have rebounded equally. Urban centers reliant on office workers are still regaining pre-pandemic momentum, while suburban and Sunbelt markets have seen faster recoveries due to population shifts and lifestyle changes.
The Investor’s View: Opportunity in Agility
For investors, the post-pandemic retail landscape offers opportunities grounded in adaptability. Value-add retail centers in need of repositioning or retenanting can be acquired at favorable prices and modernized to meet new demand patterns. Mixed-use developments that integrate residential, retail, and office components are also thriving, particularly in walkable, lifestyle-oriented communities.
Net lease retail remains a strong segment for risk-averse investors, especially when anchored by essential businesses like grocery stores, pharmacies, and discount retailers. David Lawver understands that niche opportunities exist in converting underutilized malls into logistics hubs, medical campuses, or educational facilities. The key to success lies in understanding local demographics, maintaining strong tenant relationships, and investing in flexible design that allows for space reconfiguration as tenant needs evolve.
Reinvention is the New Norm
Retail real estate has emerged from the pandemic battered but not broken. The sector is redefining itself around community, convenience, and connection. Fitness and service-based tenants are leading the way, offering stability, engagement, and experiential value that online platforms cannot duplicate.
David Lawver, founder of Turnkey Ventures, emphasizes that developers and investors willing to embrace change, invest in tenant diversification, and pursue creative property uses will be best positioned to capitalize on this next chapter. While challenges persist, the new era of retail real estate is filled with potential, rooted not in nostalgia for what was, but in bold visions of what can be.
