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At Car Lots, the Best Deal May Be the Real Estate

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Redevelopment plans are underway across the country.

In Durham, North Carolina, Hines plans to break ground this year on the former University Ford site to expand the American Tobacco Campus, a redeveloped factory complex with retail, restaurants and event space. .

Price Simms Family Dealerships, which owns 14 locations in Silicon Valley and Northern California, plans to convert its Toyota franchise in Walnut Creek into a multi-story showroom and residential project, with a small dealership occupying the first floor of the project. doing. The company’s chief executive, Adam Sims, said the value of the business was being overtaken by the underlying value of real estate.

And two Wilmington, N.C., developers aim to transform a car dealership next to a defunct Kmart into 298 apartments and shops in a complex called Paseo. Her Mariana D. Molina, president and founder of Bella Vista Development, one of her companies on the project, said: “This is a really car-centric community, just a sea of ​​parking lots.”

About 18,000 new car dealerships in the US operate in a state of flux, according to industry experts. Major changes such as growing interest in electric vehicles and increasing online shopping point to a future where these companies offer a variety of shopping experiences.

According to senior partner and automotive expert Inga Maurer, the stereotypical vision of endless rows of cars adorned with colorful plastic flags and inflatable sky dancers nodding in the breeze will have a small footprint for sale. will be replaced by more space for maintenance and electric vehicle charging infrastructure.At McKinsey & Company. Electric vehicles don’t require oil changes or powertrain changes, but the growing number of sensors and electronics in electric vehicles still requires a visit from a mechanic.

Despite these changes, Maurer said 75% of customers still see test drives and on-site experiences as a core part of the buying process. Also, in the car sales franchise model, even when consumers start shopping online, they still need to complete a transaction with a dealer.

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