As department stores exit, mall makeovers begin
As big-name retailers prepare to close hundreds of stores this year, many traditional shopping malls and the communities where they reside face a disturbing dilemma: What to do with all that empty space?
For healthier malls, it may come down to cutting deals with new types of retail tenants. But for modest and marginal shopping centers, filling space will require thinking outside the traditional big beige mall and repurposing all or some of these enormous spaces to meet radically different demands.
Already in other parts of the country, malls are being rebirthed as medical centers, data processing hubs, micro loft apartments, office parks and even megachurches.
The Chicago area and Illinois have been slow to adapt, but that will have to change as more anchor tenants such as Sears, Macy's, Kohl's and J.C. Penney retrench and digital rivals like Amazon continue to advance."Everybody's going to take a step back and re-evaluate how these spaces should be used," says Alden Loury, director of research and evaluation for the Chicago-based Metropolitan Planning Council, which has examined the financial and social impact that mall retail vacancies have on mostly black communities.
Illinois has about 60 major malls, the majority in the Chicago area, and seven outlet malls that collectively house over 6,000 stores, according to Mallsinfo.com, which tracks the industry. However, a significant number probably won't survive the seismic retail store shake-up that's underway.
Nationally, an estimated 300 malls — about a third of the total number — are expected to close over the next 10 years, according to industry research. That's a conservative estimate that likely will accelerate as digital buying increases and inflicts greater pain on the bottom lines of bricks-and-mortar retailers, experts add.
It's no huge surprise that malls catering to upscale shoppers in more well-heeled communities have a better chance of surviving the loss of a major tenant or shakeout. If a mall can replace a Macy's with a Von Maur, a high-end department store, it's a manageable adjustment.
It's no huge surprise that malls catering to upscale shoppers in more well-heeled communities have a better chance of surviving the loss of a major tenant or shakeout. If a mall can replace a Macy's with a Von Maur, a high-end department store, it's a manageable adjustment.
Moreover, retail mall developers are trying to re-energize these open spaces by luring more restaurants, gyms or entertainment venues. For instance, since 2011 the locally based General Growth Properties has invested nearly $1.5 billion nationwide to freshen up 91 vacant or near-vacant department stores and mall spaces.
It's community malls in less affluent areas, whether in the suburbs, city or downstate, that are prime makeover candidates. Typically, they offer wide-open building space, ample parking and locations that are accessible to highways or transit services.
But they won't be going it alone — expect any post-mall adventure to take the taxpayers along for the ride.That's because, more often than not, attracting new tenants or companies will require communities to invest in building or improving roads and sewers connected to these hulking buildings.
Infrastructure investment is "very important" to any relaunch, says Ellen Dunham-Jones, professor and architecture expert at the Georgia Institute of Technology, who maintains a database on mall retrofitting projects In Illinois, only a handful have occurred since the late 1990s, she says.
"I'm not seeing much reuse of dead/dying malls in Illinois to substantially reposition their communities," Dunham-Jones wrote me in an email.
Yet as traditional malls become more endangered, local community and business leaders must rethink how these longtime shopping hubs can be redeployed and put to bigger, better uses.They can start by looking to what other states — Colorado, Maryland, Florida and Texas — have done to reconstitute worn and weary malls into business or civic centers.
Now, skeptics will note that mall makeovers can be complex, take time and won't immediately match the tax revenues generated from a once-vibrant community-based mall.
That's probably true, at least for the outset of any new business project.
But owners of malls, and the communities that dearly depend on them, can no longer afford to ride the decline of the traditional department store-based meccas.
Pretty soon, they'll have to start comparison shopping for new post-mall ideas.
No comments:
Post a Comment