‘Infill’ is a term that signifies the transformation of unused land into a lucrative commercial real estate investment in urban areas. This process, which involves constructing on a vacant lot between existing buildings or demolishing older or underused properties, offers numerous benefits. It optimizes land use, reduces the burden on municipal services, and leverages existing water, power, and communication infrastructure.
What are infill locations?
Infill locations are essentially vacant lots or underutilized facilities in developed areas, typically situated between existing properties. They are prime real estate for those looking to make a strategic investment in urban commercial real estate.
Infill locations are not just vacant lots or underutilized facilities, they are potential “winners” for those with a strategic eye for urban commercial real estate. They offer promising opportunities to explore new markets, and find new avenues for expansion strategies. They can also act as a defensive strategy against competitors seeking to expand their market share.
While infill locations present promising opportunities, it’s important to acknowledge the potential risks. Any misstep in this process can be financially draining. Whether it’s developing a vacant lot or restoring an underutilized facility, infill locations demand significant time, planning, and resources before they become profitable. And if the wrong places are selected, they may never achieve profitability.
The role of Big Data in finding promising infill locations
Like any other real estate strategy, having access to crucial data is key to making informed decisions. Different data-driven approaches are available for decision-makers, such as white space analysis to identify land opportunities, site selection models to estimate market capacity for your brand, and predictive models to assess performance potential.
With the right data-driven approaches, you can significantly improve the return on investment and minimize the risk of choosing an unsuitable location.
Site Exploration
When looking for potential infill locations, it’s crucial to focus on well-developed areas with sufficient infrastructure and demand that isn’t already saturated with competitors (or your own stores). Using site exploration tools can be a good idea if you don’t have specific locations.
These tools use satellite imagery and advanced data processing to quickly and easily identify unused land in any area. They can then analyze demand, foot traffic patterns, vehicle patterns, consumer habits, socio-demographic insights, and the concentration of competitors (or potential for cannibalization) around the potential infill sites.
Trade Area Analysis
When considering a site for a new location, it’s important to understand that each site operates within a specific trade area. This means that demand for your brand may differ significantly from the overall market demand. Therefore, relying solely on metrics like distance or drive time may not accurately reflect actual sales forecasts and comparisons.
Mobility data is crucial for understanding who spends time in the trade area by day, time, or month to align with seasonal and peak business trends. At PREDIK Data-Driven, we use mobility data on interactive GIS maps to gain insights into consumer behavior, transfer times, and other POIs the target market visits.
Predictive analysis
Forecasting the performance of a new location is crucial to enhancing your infill development strategy. Predictive analytics can help with this.
Commercial real estate predictive models integrate your internal data and insights with location intelligence datasets and advanced Machine Learning algorithms. This approach produces dependable sales forecasts with the smallest margin of error in the industry. As a result, you can confidently select infill locations that deliver the highest sales or effectively obstruct your competitor’s influence in a specific area.
Use the power of Big Data for a successful infill strategy
PREDIK Data-Driven offers site selection solutions based on predictive analytics, location intelligence, and alternative data, providing the most reliable performance predictions for your site selection and expansion strategies. PREDIK helps you identify the best options when searching for and comparing infill locations.
