The Biggest Misread in CRE? The ‘Obvious’ Death of Bank Branches
In the early 2010s, the commercial real estate market began to show signs of recovering from the 2008 Great Financial Crisis, which had crippled markets worldwide. Tenants were expanding again. Investment in commercial real estate was on an upswing. Buyer activity was picking up and CAP Rates were in the earliest stages of compressing to levels never before seen.
At the same time, the internet’s influence on almost every facet of daily life was unmistakable. Its effects were so widespread that even the average person could “play the tape forward” and make educated predictions about how various industries and verticals might evolve and be impacted.
At that time, no single use type faced more questions about its future viability as a commercial real estate asset class than retail bank branches. Online banking had become universal, and many mobile apps were becoming sophisticated enough to handle tasks that once required visiting a physical branch.
The chorus of predictions grew louder and more relentless:
- “Bank branches are going to be a thing of the past.”
- “I would never buy a bank branch. They won’t last as a tenant.”
- “Banks are the next Blockbuster Video.”
Many commercial real estate investors would not consider buying a property leased to a bank. Period.
But the conventional wisdom of the armchair quarterbacks proved wrong. JPMorgan Chase continued opening new branches at a rapid pace, even after acquiring Washington Mutual’s banking operations just a few years earlier—2,200 branches across 15 states, purchased from the FDIC for only $1.9 billion. Calling that deal the steal of the century would hardly be an exaggeration. The acquisition became a key catalyst in JPMorgan’s rise to the strongest and most dominant bank in the United States.
Now, it’s true that banks have been trimming their branch count for nearly 20 years. In most cases, the closures involved older, outdated and/or lower performing locations—branches without drive-thru ATMs, often housed in oversized or two-story buildings. By contrast, the newer 3,500–4,000 square foot freestanding branches with modern site layouts have largely remained open.
Why would banks push so hard to open new branches after the Great Financial Crisis, when these same institutions were at the very nucleus of the implosion that brought the financial world to its knees? Why do we need physical bank branches when currency has been digitized?
I don’t know the definitive answer to these questions. What I do know is that the banks’ strategy appears to have worked. If asked those questions today, my response would be the same one I gave to investors who dismissed bank branches as viable commercial real estate investments back in 2010, 2011, 2012, and the years that followed, when many insisted the sky was falling on banks as we knew them:
I’m pretty sure the people running these banks likely know more about their business than the average commercial real estate investor. They’re fully aware of the internet and the changes it has brought—yet they continue to open branches. Don’t you think they might know something you don’t?
Of course they do. That’s why they continued opening new branches.
Here we are today, approaching 2026. Technology is far more advanced than it was in 2010, 2011, or 2012. You might assume that banks, with their robust digital infrastructure, would have stopped expanding their branch networks by now, right?
Wrong.
Looking through recent announcements by the largest retail banks in the US, it is clear that branch growth isn’t just picking up, it is moving full steam ahead.
The following bullet points outline publicly stated branch expansion plans for the next several years for some of the biggest banks in the US:
- JPMorgan Chase: 500 new branches through 2027
- Bank of America: 150-170 new branches through 2027
- Fifth Third Bank: over 200 new branches through 2028
- PNC Bank: over 300 new branches through 2030
- Wells Fargo: 23 new branches in Chicago / 20 new branches in NYC through 2026
It certainly appears that retail branches are here to stay. Commercial real estate investors can take that to the bank.
The Opportunity:
These planned openings represent more than 1,200 new bank branches expected to open across the U.S. in the coming years. Investors and developers should be licking their chops.
So how does one identify the best sites for these tenants? The first place to look is within a platform that highlights properties with expiring leases. The ability to search for freestanding buildings on parcels of 30,000 square feet or more, with short remaining lease terms, would immediately surface meaningful opportunities.
If only a platform existed that could bring this older information to light—and make sourcing opportunities like these as simple as searching data from properties that have been on the market over the last 5, 10, 15, or even 20 years.
Enter DealGround—where users are consistently finding opportunities they never would have uncovered on any other platform or by digging through their homemade storage and filing “systems.” With DealGround, you can:
- Search for freestanding parcels with the right size criteria
- Filter for short remaining lease terms
- Map tenant locations and identify trade area gaps instantly
- Layer in tenant and use-type data across 62M+ properties
- Surface off-market opportunities hiding inside old OMs
Why limit your world of opportunity to only what is on the market? Trust me, there is way more opportunity off market than on. You just need the right tool to put those opportunities at your fingertips. Finding more deals leads directly to making more money, and our mission at DealGround is simple: give users faster access to better data so they can do exactly that.
Don’t take my word for it—log in and see for yourself.