This month, Amazon announced that it will be opening a new 230,000 sf big box store in the suburbs of Chicago. Half of the store will be consumer-facing, where customers can browse aisles for groceries, household items, and general merchandise, and the other half will serve as a kind of micro-fulfillment center.
Supposedly, the municipality applied a restriction to the lands requiring it to be a consumer-facing store; it can't just be for fulfillment. But it seems that some kinds are allowed.
My understanding is that the "fulfillment" component of the project will allow customers to order (on kiosks throughout the store) certain items "from the back" and have them delivered to the front of the store for checkout. Importantly, it also decouples inventory management and optimizes the back-of-house for online grocery.
This is a big store; bigger than even a Walmart Supercenter. It also sits on a 35-acre site, which means the lot coverage is only around 15%. However, there's also a large stormwater management pond and room for additional pad buildings based on this site plan:
A store this massive is a fascinating signal because it's a clear admission from Amazon that it needs to get its brick-and-mortar strategy right if it wants to compete in grocery. Even after its Whole Foods acquisition, it's only about 3% of the US grocery market, whereas Walmart is sitting at over 20%.
Ten years ago, it did not feel like this would be where we would end up. Retail as a real estate asset class was out of favor. Brick-and-mortar retail seemed destined to be disrupted by e-commerce and drone delivery. But retail evolved and grocery proved to be a unique facet of retail. At least so far.
Cover photo by Brittani Burns on Unsplash
Wing, the aerial delivery company owned by Alphabet, recently announced an expansion to 150 more Walmart stores across the US this year. This also includes four new cities: Los Angeles, St. Louis, Miami, and Cincinnati. The company now says that it has completed over 750,000 deliveries since it launched in 2012. And the goal is to be flying out of 270 Walmart locations by 2027.
There was a period over a decade ago when drone delivery was in its "hype phase." This also coincided with retail being out of favor as a real estate asset class. Drones made e-commerce seem even more threatening. Then things quieted down when regulation, noise, privacy, and other obstacles got in the way of the drone hype. But as with all new and promising technologies, the building continued, just less publicly.
Noise and privacy are serious concerns, but I understand that there are now "bladeless" drones and drones that use shrouds to direct sound upward. For the sake of argument, let's assume these problems can be solved. Now I wonder: Who is this for and where do they live?
Because of weight limitations, drone delivery payloads tend to be smaller items (under five pounds). And because there's only so far that these drones can fly on a single battery charge, they tend to be for quick local deliveries. So, the use case seems to be for people who don't have the luxury of being able to walk 10 minutes to a corner store, or can't be bothered to do so.
This also aligns with the early adopters of this tech: people who live in suburban homes and have driveways where a drone can easily land. This makes sense as an easy first solution, though I think you could make the case that landing on the roof of a tall building might actually be less conspicuous and disruptive at scale.
As it stands, drone delivery is an overwhelmingly suburban solution. The environment is convenient for takeoff and landing, and it's an environment where fetching small items probably isn't convenient. This solves that. And the company appears to be scaling. But how far will it go? And will it ever become a widespread urban solution?
I'm writing this post from the concourse level of Place Ville Marie Esplanade in Montréal (also known as Galerie PVM) while I wait for my next meeting. Like the PATH in Toronto, the space I'm in is part of an underground network of restaurants, shops, and circulation spaces that runs through downtown Montréal.
But what makes the space I'm in right now particularly noteworthy is that I'm sitting beneath an enormous glass roof supported by 18 glass beams measuring 15 meters long and 0.9 meters tall. So, while I am below grade, I have a clear view of The Ring, Mont-Royal, and the street life happening above me.
This month, Amazon announced that it will be opening a new 230,000 sf big box store in the suburbs of Chicago. Half of the store will be consumer-facing, where customers can browse aisles for groceries, household items, and general merchandise, and the other half will serve as a kind of micro-fulfillment center.
Supposedly, the municipality applied a restriction to the lands requiring it to be a consumer-facing store; it can't just be for fulfillment. But it seems that some kinds are allowed.
My understanding is that the "fulfillment" component of the project will allow customers to order (on kiosks throughout the store) certain items "from the back" and have them delivered to the front of the store for checkout. Importantly, it also decouples inventory management and optimizes the back-of-house for online grocery.
This is a big store; bigger than even a Walmart Supercenter. It also sits on a 35-acre site, which means the lot coverage is only around 15%. However, there's also a large stormwater management pond and room for additional pad buildings based on this site plan:
A store this massive is a fascinating signal because it's a clear admission from Amazon that it needs to get its brick-and-mortar strategy right if it wants to compete in grocery. Even after its Whole Foods acquisition, it's only about 3% of the US grocery market, whereas Walmart is sitting at over 20%.
Ten years ago, it did not feel like this would be where we would end up. Retail as a real estate asset class was out of favor. Brick-and-mortar retail seemed destined to be disrupted by e-commerce and drone delivery. But retail evolved and grocery proved to be a unique facet of retail. At least so far.
Cover photo by Brittani Burns on Unsplash
Wing, the aerial delivery company owned by Alphabet, recently announced an expansion to 150 more Walmart stores across the US this year. This also includes four new cities: Los Angeles, St. Louis, Miami, and Cincinnati. The company now says that it has completed over 750,000 deliveries since it launched in 2012. And the goal is to be flying out of 270 Walmart locations by 2027.
There was a period over a decade ago when drone delivery was in its "hype phase." This also coincided with retail being out of favor as a real estate asset class. Drones made e-commerce seem even more threatening. Then things quieted down when regulation, noise, privacy, and other obstacles got in the way of the drone hype. But as with all new and promising technologies, the building continued, just less publicly.
Noise and privacy are serious concerns, but I understand that there are now "bladeless" drones and drones that use shrouds to direct sound upward. For the sake of argument, let's assume these problems can be solved. Now I wonder: Who is this for and where do they live?
Because of weight limitations, drone delivery payloads tend to be smaller items (under five pounds). And because there's only so far that these drones can fly on a single battery charge, they tend to be for quick local deliveries. So, the use case seems to be for people who don't have the luxury of being able to walk 10 minutes to a corner store, or can't be bothered to do so.
This also aligns with the early adopters of this tech: people who live in suburban homes and have driveways where a drone can easily land. This makes sense as an easy first solution, though I think you could make the case that landing on the roof of a tall building might actually be less conspicuous and disruptive at scale.
As it stands, drone delivery is an overwhelmingly suburban solution. The environment is convenient for takeoff and landing, and it's an environment where fetching small items probably isn't convenient. This solves that. And the company appears to be scaling. But how far will it go? And will it ever become a widespread urban solution?
I'm writing this post from the concourse level of Place Ville Marie Esplanade in Montréal (also known as Galerie PVM) while I wait for my next meeting. Like the PATH in Toronto, the space I'm in is part of an underground network of restaurants, shops, and circulation spaces that runs through downtown Montréal.
But what makes the space I'm in right now particularly noteworthy is that I'm sitting beneath an enormous glass roof supported by 18 glass beams measuring 15 meters long and 0.9 meters tall. So, while I am below grade, I have a clear view of The Ring, Mont-Royal, and the street life happening above me.
Underground "malls" like Toronto's PATH and Montréal's RÉSO were a somewhat obvious urban solution to inclement weather. But they are often criticized for sucking life underground and making the streets at grade feel dead.
When I've toured my American friends through Toronto's CBD in the past, I've heard comments like, "How come you have no retail downtown? It feels dead." And then I have to cheekily say, "Oh, well, we actually have tons of it, we just decided to hide it all underground so it's harder to find and confusing to navigate."
The way you start to counteract these negatives — lack of street life and challenging wayfinding — is to do what Sid Lee Architecture did masterfully here at Place Ville Marie. To the extent possible, you make grade and below grade feel like one space.
Underground "malls" like Toronto's PATH and Montréal's RÉSO were a somewhat obvious urban solution to inclement weather. But they are often criticized for sucking life underground and making the streets at grade feel dead.
When I've toured my American friends through Toronto's CBD in the past, I've heard comments like, "How come you have no retail downtown? It feels dead." And then I have to cheekily say, "Oh, well, we actually have tons of it, we just decided to hide it all underground so it's harder to find and confusing to navigate."
The way you start to counteract these negatives — lack of street life and challenging wayfinding — is to do what Sid Lee Architecture did masterfully here at Place Ville Marie. To the extent possible, you make grade and below grade feel like one space.
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