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Luke Petherbridge, President and CEO of ShopCore Properties, Presents to UW Real Estate Club

Posted By David Walsh, Wednesday, October 10, 2018

 


The Real Estate Club recently hosted Luke Petherbridge, President and CEO of ShopCore Properties. Mr. Petherbridge has over 15 years of experience in finance, global real estate, and management. Prior to ShopCore, he worked as CFO and Treasurer of DDR Corp., and prior to that role was the CEO and a Director of EDT Retail Trust.

 

At a well-attended meeting, Mr. Petherbridge began by putting the commercial real estate market in perspective for students. Of the $48 trillion or so in real estate (the largest asset class in the US), $16 trillion is commercial, $2 trillion is listed, and $300 billion is listed retail properties. Mr. Petherbridge’s objective with explaining these numbers was to provoke thought regarding the relatively small allocation of major funds and endowments to commercial real estate. An outlier, he explained, is the Yale Endowment, which has an allocation of about 11% for real estate and has seen exceptional growth. While describing it as an over-allocation, Mr. Petherbridge says it does show the increase in institutional capital being invested in real estate.

 

Mr. Petherbridge went on to discuss specifically the retail environment and his thoughts on the adaptations coming soon. For present day, he used Apple iPhone purchases as an example of a brick and mortar store experience still attracting customers. He asked students how many had iPhones, and then how many went to the Apple store to buy it. Many hands were up, and Mr. Petherbridge cited the excitement and fun experience provided by the Apple store for the results. He predicts that retail will continue moving toward an omnichannel experience, meaning you can buy a product on your phone and pick it up in the store or shop the product in the store and have it shipped home.

 

Another intriguing topic Mr. Petherbridge covered was the transition being made by e-commerce firms into stores. Using Amazon, Warby Parker, and Bonobos as examples, Mr. Petherbridge blamed shipping expectations of consumers and the related cost to companies. He explained the cost of the “last mile” in delivery and reminded students that Amazon has convinced the population that they should get items in two days and not pay for it. No economic model works for that, Mr. Petherbridge argued.

 

Other topics of the night included big data, REIT valuation, similarities and differences between the US and Australia (Mr. Petherbridge’s place of origin) retail markets, and more. Undergraduates and MBA students alike enjoyed and learned from Mr. Petherbridge’s engaging presentation.  

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