Many retailers are trying to evolve with the changing of times to create seamless exchange and integration between online, and in-store purchases, says a source in this EXCLUSIVE commentary.

LOS ANGELES—Locally based Paul Davidovac, an agent in capital markets at Commercial Brokers International, says that hands on experiences, and interactive communities are becoming more and more necessary for retail stores, malls, experiential complexes, and shopping regions to thrive in today’s market. According to Davidovac, e-Commerce companies have gained significant market share in today’s retail market place.

The views expressed below are Paul Davidovac’s own.

Many retailers are trying to evolve with the changing of times to create seamless exchange and integration between online, and in-store purchases. Those that are not adapting like traditional stores Sears, Kmart and JCPenney, are closing more stores than ever before.

The other day I was speaking with a good friend at Westfield’s who brought up their annual report, How We Shop Now: What’s Next. This 2015 report confirms how they spent $1 billion to re-develop the new Century City Westfield Mall into a ‘lifestyle center’, and what the corporation’s plans are looking to the future.

John Zeigler, a Santa Barbara retail analyst and CEO at STG Asset Management explains, “The Internet is taking away a lot of business from bricks-and-mortar stores”. Food centric retail makes sense as eating is something that you need to do in person, and not online.

This is clearly evident as the center has around one quarter of the mall devoted to food and beverage. “A top-tier mall has to be experiential.” says Peter Lowry, co-chief executive of Westfield Corp. Lowry points to competitors like the Grove, and Amazon.com when discussing the needed makeover of The Century City Westfield Mall.

This gives you an idea of the ‘Mall Wars’ between the Grove, Beverly Center, and Westfield. Smaller projects and ‘mom and pop’ retail owners are also adapting. Some of the more prolific streets, Robertson and Melrose, in Los Angeles are finding the traditional retailer move out, and the owners are trying to find ways to create an enhanced experience for customers to come to their shops.

Developers are looking to create experiential retail on their ground floor as amenities to draw in the tenants above.

In a discussion with Rob Provine, Managing Partner at Meyer Bergman Americas, he said, “In all of our projects we start with the ground floor to determine what the most attractive and innovative concepts which will generate sales, but also excitement as this most visible and highly trafficked part of the property sets the tone for all that is above. Whether it be a curated food option, a lifestyle concept or health and beauty – the focus is on occupiers which provide a product or service which provides an experience not achievable from behind a computer or iPhone screen.”

So, we are seeing Food & Beverage, Health and Fitness, a fun Environment, and Entertainment (Film, Theater, Shows, Art) expand faster as consumers’ wants and needs change. People are going to places where there is a community feel. They can experience the benefits of meeting up with friends, whether it’s during a group fitness class like F45 Training, then go next door to grab a coffee, juice or bite to eat, plug in to Wi-Fi and get some work done. The retail stores that are incorporating user experiences are the ones that seem to be flourishing, and landlords are needing to adapt and be flexible with the markets changing demand.

The rise of experiential retail is all around us. Who knows what will be next with technology growth, and further development of Virtual and Augmented Realty. We will surely see more brick and mortar stores and malls adapting, and growing to offer consumers the opportunity to experience brands, and culture.