Digitisation has created unlikely winners: real-estate barons
The wheeler-dealers of commercial property are a world away from the hipsters of big tech—more mini Donald Trumps than Steve Jobses. Theirs is an industry of bricks, not bits. Their sales grow square foot by square foot. They fight locally, not in “winner takes all” markets. Few people ever got into Stanford University boasting that their life’s ambition was to build real estate.
Surveying the landscape of America and Europe, it is easy to portray commercial bricks and mortar as technology road kill. In America, even though e-commerce still accounts for less than 10% of retail sales, it has left dead malls, derelict shopping centres and bereft landlords in its wake. In Britain, with higher online-shopping penetration, the owners of high-street property suffer from an epidemic of boarded-up shops and bankruptcies. Some hedge funds are betting on their debts becoming the next “Big Short”.