Retail Revolution in Commercial Real Estate 🏢

How Online Businesses Are Reshaping the Market Forever

Author

Anne Morgan
May 28, 2025

In partnership with

The key to a $1.3T opportunity

A new trend in real estate is making the most expensive properties obtainable. It’s called co-ownership, and it’s revolutionizing the $1.3T vacation home market.

The company leading the trend? Pacaso. Created by the founder of Zillow, Pacaso turns underutilized luxury properties into fully-managed assets and makes them accessible to the broadest possible market.

The result? More than $1b in transactions, 2,000+ happy homeowners, and over $110m in gross profits for Pacaso.

With rapid international growth and 41% gross profit growth last year, Pacaso is ready for what’s next. They even recently reserved the Nasdaq ticker PCSO.

But the real opportunity is now, before public markets. Until 5/29, you can join leading investors like SoftBank and Maveron for just $2.80/share.

This is a paid advertisement for Pacaso’s Regulation A offering. Please read the offering circular at invest.pacaso.com. Reserving a ticker symbol is not a guarantee that the company will go public. Listing on the NASDAQ is subject to approvals. Under Regulation A+, a company has the ability to change its share price by up to 20%, without requalifying the offering with the SEC.

Hello, Commercial Real Estate Pros! 🏢

This week, we're delving into how online businesses are transforming commercial real estate and examining effective strategies to capitalize on and profit from this evolving market.

📰 Upcoming in this issue

  • 🏢 How Online Businesses Are Changing Commercial Real Estate

  • 🏢 Cracking the Commercial Property Market

  • 🏢 Mastering Seller-Financed Multifamily Deals

🏢 How Online Businesses Are Changing Commercial Real Estate

The rise of online businesses is transforming traditional commercial spaces—driving landlords to adapt to a more flexible, experience-driven market.

Key Takeaways:

  • 📦 From Stores to Experiences: Retail properties are evolving beyond sales, becoming hubs for dining, wellness, and interactive showrooms.

  • 🔄 Shorter, Flexible Leases: Digital-first businesses are pushing landlords toward shorter leases and flexible spaces to remain agile.

  • 📈 Valuation Shifts: Investors and lenders now prioritize adaptability and tenant versatility over traditional long-term stability.

  • 🏙️ Creative Repurposing: Spaces are being converted into event venues, pop-ups, and creative hubs, emphasizing versatility.

🏢 Cracking the Commercial Property Market

Entering the commercial real estate market can seem daunting, but the right insights can transform uncertainty into opportunity.
Read the full article here »

Key Takeaways:

  • 📈 Lease Doc Loans Advantage: Leverage loans based on lease strength, not personal income, for easier entry.

  • 💡 Focus on Essential Services: Invest in properties tied to resilient sectors like healthcare and industrial services.

  • 🛠️ Industrial Is Booming: E-commerce growth makes industrial real estate a hot market, offering stability and strong returns.

  • ⚠️ Avoid Inflated Leases: Beware of artificially high lease prices; focus on sustainable property values.

🏢 Mastering Seller-Financed Multifamily Deals

Discover how seller financing can change your commercial real estate investing game—and the key pitfalls to avoid in structuring your deal.

Key Takeaways:

  • 🔑 Seller Financing Advantage: Dramatically reduce upfront loan and closing costs, enhancing deal feasibility and returns.

  • 📊 Critical Math: Ensure commissions are clearly built into your financing structure; always add your commission to the seller’s asking price to maintain accurate deal numbers.

  • 📉 Understand Vacancy Rates: Even slight adjustments in vacancy rates dramatically impact your returns; meticulous projections are crucial.

  • 🚨 Navigate Rent Control Wisely: In states with rent control (like New Jersey), creatively use utility charge-backs and fees to legally enhance revenue beyond rent hikes.

  • ⚖️ Tax Strategies: Consider LLC buyouts to avoid massive property tax reassessments post-purchase, preserving your deal’s profitability.

Why It Matters

Staying ahead of these commercial real estate shifts helps you turn industry changes into strategic opportunities, ensuring long-term investment resilience and profitability.

Anne Morgan
Editor-in-Chief
Commercial Real Estate Weekly

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