The Station's Agent
I skate to where the puck is going to be, not where it has been. -Wayne Gretzky
There may be no more overused quote in all of business - perhaps even the world - than the Great One's comment on what makes him a great hockey player, and with good reason. The ability for a business to predict where things are will be in their ecosystem years from now can elevate them from average to legendary. Apple saw the future with the iPod and the iPhone. Netflix saw the future with streaming video. Tesla saw the future with the electric car. Now, due to industry stalwarts that failed to act, companies like Nokia, Blockbuster (RIP), and GM are struggling to keep up.
One interesting sector that's always intrigued me is commercial real estate. No doubt this space has had its share of struggles the past few years in the wake of the COVID-19 pandemic and work-from-home initiatives. But there's a unique opportunity on the horizon, one that's essentially a 2nd order of consequence around the rise of electric vehicles.
There are more than 150,000 gas stations in the United States. A few years from now, that number will be close to zero. With the rise and eventual majority of electric vehicles on the streets, typical gas stations will go the way of Blockbuster - antiquated services that become empty husks reminding us of times past. While former Blockbusters can easily be turned into whatever the strip mall store du jour is, closed gas stations take a little more effort.
Don't get me wrong, there will still be gas stations. We'll need places to fill up our red plastic cans and bring fuel to our machines that still run on internal combustion engines: lawnmowers, snowblowers, and the occasional go-kart. But for the most part, the brands you see on every highway rest stop - your Mobils, Shells, and Sunocos - will be become players in the background. They'll still pull oil up from desert fields and deep below the ocean, but instead of fueling your car, it'll go toward natural gas power plants, air travel, and oceanic shipping. And in their place: steel and cement skeletons with faded signs and empty tanks submerged below grade will haunt street corners around the world.
What happens to them? They're often in high-traffic areas, convenient to well-traveled routes, and close to commercial centers. They often have plenty of paved parking with easy access in and out of the property. And outside of the $125,000 average costs to simply clean up a gas station site (including submerged tanks), they are, for lack of a better term, perfect.
So, what can we do with them?
The Tesla Cafe
It takes roughly 15 minutes to charge a Tesla to go 200 miles. For those 15 minutes, Tesla has a captured audience. Imagine if they took over old gas stations, replaced the pumps with their superchargers, and let drivers come in for a quick coffee? They'd give Starbucks and Dunkin' a real challenge to be the new king of caffeine. Hell, put in some convenience store necessities while you're at it such as quick bites and a bathroom that doesn't look like it could produce a Swamp Thing, and you've got a winner on your hands. (Just make sure the coffee is good.)
Let the Sunshine In
Most gas stations sit on wide, flat, tree-less swaths of land - perfect for a different type of power. Let's say the typical gas station sits on 1.5 acres of land. (This number is smaller than the current trend of 2-2.5 acres, but for a conservative estimate, we'll take the smaller size.) As a general rule, 1.5 acres of solar panels produce about 520 MWh of electrical energy per year. The actual annual profit depends on the location's irradiance (peak-sun-hours), but the average is approximately $21,000. That's small potatoes if you only own one station. But imagine if Mobil Exxon bought the property back from the owners. That's 12,000 stations in the US alone - or a sunlight-loving profit of $252,000,000. The number keeps jumping if you put the panels on the roof of a building and rented out commercial space underneath.
Take Off
As I mentioned in an earlier article, my fascination with eVTOLs continues to grow with each news story that comes out about them. They're becoming closer and closer to reality, and those vehicles are going to need a place to land. So why not make that flat patch of asphalt a prime spot to land (and launch) an electric vertical take-off and landing aircraft? It's close to commercial centers, has plenty of parking for bikes, or cars, and won't cost much to maintain.
I often wonder what the long-term plans are for people investing their life savings in opening gas stations in this day and age. It might be profitable in the short term, but it is a dying market. Between 1994 and 2013, the number of retail fueling sites in the U.S. fell from 202,800 to 152,995—a 25 percent decline, and that number will continue to drop drastically.
It's this type of thinking that benefits those who can see the tides changing before everyone else. It's looking at the trends and adapting your business to not suit the next three months, but the next three decades. It's seeing the pattern of brands bringing their marketing efforts in-house and creating a digital marketplace for them. It's recognizing the benefits of a staff that works from home. In short, it's knowing where the puck is going to be.
