Location, location, location

City centers will still have a major role to play as people still like to gather and meet face-to-face. As such, this balances out the push towards a supply glut and urban sprawl. Personally, I believe the main limiting factor going forward will be the human experience and more specifically, what level of crowd density people will be able to tolerate. This is very much dependent on the culture of the city as well as their economic status as personal space is highly subjective. Nonetheless, I think we can all agree that we hate waiting in line for lunch and more so, that colleague in the office shouting into the phone.

In terms of office space, companies will likely increase the space per employee as rents become cheaper. This will be further driven by the push towards improved employee welfare with companies acquiring more space for new amenities to attract talent. Nonetheless, the relocation of companies that were previously hesitant to locate in the city center due to costs would act as a counter-balance to this.

Decreased commercial rents will also enable retail stores to level the playing field with online retailers. This reduction in overhead costs will also be aided significantly by a retail store’s ability to now easily access their distribution center at a much quicker rate, allowing minimal inventory as well as a more lean hub-and-spoke model for distributing customized goods.

Home delivery from retail stores might see rapid growth as delivery times are significantly shortened. Food delivery will probably be the industry where the changes will be the most obvious in the short term as delivery becomes cheaper and quicker. This is not to mention the major changes the logistics industry will face with the automation of trailers.

Conversely, people might even start sending their AVs to pick up products from retailers/distribution centers when their AV is not in use. Imagine sending your AV to do all your logistic work and having everything in your trunk by the time your AV picks you up from office. This will be enabled by services such as Amazon Key but for the car. Underlying all of this will be a push towards satisfying the consumer’s need for immediate gratification.

Other sectors that will be affected are those in the modern day transit-cities. As travel becomes more comfortable due to the conversion of internal AV space, people will require less stops during a road trip. Stopover hotels will suffer as people will decide to sleep in their cars while travelling overnight.