The state of the retail industry in Southern California’s commercial real estate market was on full display Tuesday as a packed house gathered for Connect Retail West 2025 at the Luxe Sunset Blvd. Hotel in Los Angeles to hear expert panels discuss the current state of the industry.

Leading off the one-day event was the panel A View from the Top: Shaping Retail CRE on the West Coast. The panel included moderator Alex J. Caruso of Cox Castle; Jim Dillavou of Paragon Commercial Group; Joseph Miller of Runyon Group; Andrew Turf of Newmark and Kevork Zoryan of Arselle Investments.

This group of some of the West Coast’s leading retail developers, owners, and advisers delivered a clear message that brick-and-mortar retail is not only stabilizing but regaining favor among consumers and investors after more than a decade of turbulence.

The panel provided viewpoints from various retail components, including boutique placemaking, institutional investment, grocery-anchored centers, and high-street retail. Although the speakers operate nationally, the conversation focused squarely on Southern California, a region panelist described as both a bellwether and a battleground for the future of U.S. retail.

Miller, co-founder of Runyon, opened by noting the dramatic shift in perception toward small-format, design-forward retail. “We specialize in what used to be very unpopular, small boutique properties with small boutique tenants,” Miller said. Runyon has advised on projects ranging from Rockefeller Center’s master plan to Culver City’s highly visible Platform development. “We’ve been doing this for almost 20 years, and the demand for curated retail is stronger than ever,” he added.

Investment veteran Zoryan of Arselle Investments provided a capital-markets perspective, noting that retail’s recovery cannot be understood without acknowledging the major structural shifts of the past decade. More than 200 million square feet of retail space has been demolished nationwide in the past 10 years, he said, while new supply has grown only minimally. “The denominator is shrinking, but the consumer is actually spending more,” he explained, pointing to the strength of brick-and-mortar sales despite lingering assumptions about e-commerce dominance.

Dillavou, co-founder of Paragon Commercial Group, said the renewed enthusiasm for retail is rooted in fundamentals. “Everybody’s wondering how retail went from being the redheaded stepchild to being in favor so quickly,” he said. “The answer is simply supply. There is no more supply.” With grocery-anchored centers in particular, Dillavou said the industry has reached an “equilibrium” as grocers have successfully integrated online ordering, pickup, delivery, and in-store shopping. “This is ten years of data. We’ve hit the stabilization point,” he noted.

High-street retail broker Turf, formerly with CBRE, echoed that sentiment, emphasizing sustained demand in coastal metros such as London, New York, Miami, and Los Angeles. “It’s the same space Joey [Miller] and I both play in,” he said. “These markets continue to prove their resilience.”

Panelists agreed that the capital markets have begun shifting back toward retail after years of under-allocation. Institutional investors have historically favored malls, but with many B- and C-class malls struggling and A-class malls tightly held, new capital is now flowing into grocery-anchored properties, neighborhood strips, and curated retail.

“Capital flows have been turned off for ten years,” Dillavou said. “Now they’re turning back on. Institutional allocators review their portfolios and realize they don’t have enough retail exposure, and they can’t allocate more money to the office. Industrial has slowed. Multifamily is mixed. Retail is where they’re looking.”

As construction costs continue to climb, panelists cautioned that new retail development is likely to remain highly selective. Replacement rents would need to rise significantly to make large-scale ground-up projects viable. Still, speakers emphasized that demand is robust and consumer behavior increasingly supports physical retail environments.

“Real estate is a backyard game,” the moderator, Caruso, said to end the panel. “And in Southern California’s backyard, retail is very much alive.”