Stepping back in time to re-imagine the future of malls

Discussion
Apr 17, 2015

When you’re alone and life is making you lonely
You can always go downtown.

Looking back to the days when shopping centers were not just about commerce but entertainment and community as well could help explain some of the most significant changes currently being made in retailing.

A Washington Post analysis of the current state of malls refers to a new preference for "outdoor ‘town centers’ and ‘lifestyle centers’ that much more closely resemble the old urban downtowns — community centers with sidewalks, public spaces, outdoor restaurants — that the original indoor mall decades ago helped kill."

Watching from Australia, architect and city planner, Mark Hinshaw, told Radio Australia that he believes America’s malls were "a major phenomenon that’s lasted for six decades … people assumed they would go on forever. But that is changing; people are now looking at other ways of living."

Analysis from Wharton Business School, underpinned by a McKinsey report, also harks back to a time when people walked "downtown" to shop, eat and socialize.

Wharton real estate professor, Susan Wachter, notes a return to people living in cities, fuelling demand for combined residential and shopping areas, preferably near where they work. "Many of these malls are old — built in the 1950s and 1960s," she explained. "At the time, Americans were moving farther out from cities. Today, they’re moving back into cities."

Furthermore, Prof. Wachter cites McKinsey’s conclusion that "a storm of global trends are coming together at the same time to cause malls to change the role they play in people’s lives. No longer are they primarily about shopping. Now, when consumers visit malls, they are looking for experiences that go well beyond traditional shopping."

The Post’s conclusion? Today’s shopping centers are "vindication if you’re an urban planner or someone who never liked malls in the first place."

Do you see the mall concept given new life with the aid of outdoor lifestyle centers? To what extent will revived downtown areas replace the need for malls? How do you see the role of malls changing?

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18 Comments on "Stepping back in time to re-imagine the future of malls"


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Dick Seesel
Guest
2 years 10 months ago

There is a “lifestyle center” in my neighborhood in suburban Milwaukee called “Bayshore Town Center.” It replaced an outdated combination strip and indoor mall (with elements from the ’50s and ’70s), and has thrived ever since reopening in 2006. Two of its three original anchors (Bon Ton and Kohl’s) are still in place, while Sears closed last year and is awaiting redevelopment. Apparently the outdoor storefronts (in Bayshore’s faux “downtown”) are more successful than the locations inside the mall, even during winter weather.

Clearly the “socialization” aspect of lifestyle centers is important—complete with dining options, movie theaters, etc.—and it’s also an advantage not to be locked into giant mall anchor department stores as that segment continues to shrink. But the giant regional mall isn’t dead yet, as long as developers keep the tenant mix and entertainment options fresh.

Ralph Jacobson
Guest
2 years 10 months ago

As 70-plus percent of Americans and 50-plus percent of the world’s consumers are living in or moving into cities, the future for concentrated retail shopping outlets (e.g., malls) will increase. Many malls in economically-recovering locations are doing better than ever. In the right areas, consumer lifestyle upgrades are making a difference as we speak, such as free Wi-Fi, etc. Whereas malls of the past and recent future were hangouts for younger people, I can see that coming back because of limited choices for recreation in dense cities.

Cathy Hotka
Guest
2 years 10 months ago

Every retailer I talk to says malls are very much alive. They’ll continue to evolve and serve the changing needs of their customers.

That said, it will be interesting to watch what happens to older malls that are no longer needed. I have some highly-placed analyst friends who think they’ll be turned into living spaces for seniors (complete with eye doctors and walking paths), and that’s probably a good bet.

Ed Rosenbaum
Guest
2 years 10 months ago

We have several outdoor lifestyle centers in this area of South Florida. All seem to be successful as entities. There are always a few stores that will not make it. But the majority are doing well. They do well during the day even with the hot sun beating down. At night, they become more of an entertainment venue with the many restaurants, etc. This is back to the future in many ways.

This will change the way malls operate as many retailers will opt for the outdoor effect. There is a major change happening in Owings Mills, Md. just outside Baltimore where a large mall had come upon hard times. Traffic dropped for many reasons. The entire mall and surrounding area is being given a total facelift with the result being a large outdoor lifestyle center. The negative on this site will be the traffic backups it will create.

Tom Redd
Guest
2 years 10 months ago
Who needs to do all the thinking, analysis, etc.? Just the basics please. Here is THE BASIC LIFE CYCLE OF RETAIL. Let’s jump into the cycle in 1975 … Shoppers and technology were so different in the ’70s and ’80s. Malls fit the time when people HAD more time. The time that they had started to fill up with innovation adding more options of what to do with the extra time and jobs became more demanding as more demands were placed upon the businesses. The CLOCK TICKED. These darn people changed as the shape of life and time use changed. More shopping centers opened and met the time demands of the shoppers. The Home Depot or Lowe’s anchored strip malls. There were also pool supply stores, pet superstores, a Target and more (like a video rental place). These places overbuilt in some regions and FOR LEASE signs appeared up and down the facing of the strip. Lifestyle centers or old malls with no roofs started sprouting, the social tools of the shopper or humans changed… Read more »
Gene Detroyer
Guest
2 years 10 months ago

I had an interesting discussion the other night with a real estate developer in the NY metro area. He specializes in high rise apartment buildings. But his specialty goes further than that. He only builds around transit hubs. Essentially, buildings that are within a short walk to the rail station. And his target market are the “older” Millennials.

He said even if they are in the suburbs, there is little interest in the traditional suburban life style. They would rather have have an apartment than a house. Many don’t even own cars. They want access to the center city, both for work and play. They would rather experience things than accumulate things, and that experience does include getting in a car and “going shopping.”

I don’t know if this phenomenon is widespread across the country, but I believe in the metro areas it is happening. If you can’t live in the city, at least have no-fuss access to the city.

Ben Ball
Guest
2 years 10 months ago

First up, a shout out to Bernice for the Pet Clark reference. Brilliant!

Next at the plate, Cathy Hotka for hitting the future nail on the head—senior living complexes that have the accommodations of current senior living with more than the requisite “gift store,” mini-bank and fitness center to offer for entertainment. A pod-living concept version of today’s hugely popular “town center” concepts like The Glen in Glenview by my office. They just built one in my hometown of Asheville and it sold out fast. Now you can’t find a condo for sale there. Seniors will love this idea.

Ryan Mathews
Guest
2 years 10 months ago

The growth of malls is inexorably linked to the future of suburbs. As people return to urban areas shopping centers lose their relevance.

James Tenser
Guest
2 years 10 months ago
I believe there are two relevant and related trends that are pertinent to this discussion. The transformation of some regional enclosed malls into open-air centers is certainly one of them. The other is the development of modern mixed-use developments that combine mid-rise housing, shopping, services and even schools. Here in Tucson we have a fine example of the first trend at the El Con Center, an in-town enclosed mall that had been on a downward spiral a decade ago. In the past few years it has been converted into a thriving open-air center with Target, Home Depot, Walmart and a movie multiplex among its anchors. The perimeter pads house a range of restaurants from quick-serve to sit-down. This is a solution that may work a little better in a warm climate zone, but it’s a promising model. I also recently became aware of a proposed mixed-use urban development in a northern Virginia suburb, one of many around the country. This plan is built around a showcase modern public high school, a park, student, senior, family… Read more »
Bill Davis
Guest
2 years 10 months ago

To some extent, but it’s more of an evolution than a wholesale makeover. And for areas where winter occurs, ways for dealing with this will need to be developed as I am pretty sure few, if any, people in the Boston area wanted to visit the outdoor lifestyle center this past winter. That being said, the Hotel de Glace, in Quebec City might offer some ideas to be considered as when I was there seven or eight years ago they had an ice slide for the kids, small and big, near the reception desk.

One company having great success improving the mall experience is The Legaspi Company. While I haven’t visited their one of their properties in person, they are getting a great deal of recognition within the Hispanic community for reinventing the mall concept.

Ed Dunn
Guest
2 years 10 months ago

These town center complexes built in the suburbs still have the obvious problem—big box retailers such as Walmart and Home Depot plus Amazon in addition to chain shops like Chipotle and Starbucks and retailers like Macys. They can build these town centers full of local entrepreneurs but pricing and branding will always be a factor for suburban customers.

The most successful model I have seen is Bayside Marketplace in Miami which offers entertainment and lifestyle in addition to shopping. Many suburbs simply do not have the deep pockets to create this environment to bring in acts and events to sustain this atmosphere until they strike a balance accommodating big box tax revenue and supporting a viable town center development.

Roger Saunders
Guest
2 years 10 months ago
First of all, we have to accept that human beings are “tribal” and that they have a certain instinctual love affair with the “bazaar.” Sure, they are going to make use of the Internet at an ongoing higher use of frequency. But that’s not going to stop them from going to the mall, provided the malls and urban villages that are springing up around the country are providing them efficiency, choice, safety, entertainment (shopping is entertainment) and value. Just as the radio didn’t put musical acts out of business nor did iTunes create the demise of radio, as the medium reinvents itself, so too will malls appeal to the tribal aspect of shopping together in the bazaar. Based on the Prosper Monthly Consumer Survey of more than 6,500 adults, as of March, 2015, among adults 18 and older, 15.4 percent prefer to shop at malls while 45 percent are equally happy with malls and free standing stores. In March of 2014 those figures were 14.8 percent and 45.8 percent respectively and in March, 2013, 14… Read more »
Herb Sorensen
Guest
2 years 10 months ago
Excellent question here. I have long wondered at the massive “parked capital” represented by malls. But that is a larger problem which is addressed, aggressively, by online shopping. However, I insist that, “As long as people live in bricks-and-mortar houses, they will shop in bricks-and-mortar stores!” And that includes shopping malls. The proper paradigm for thinking about this is that ALL purchases can be divided into two basic categories: “surprise/delight/NOW!” and “routine/autopilot/frustration.” The routine/autopilot/frustration purchase is properly OWNED by online retail, whether provided by a pure online retailer, or a hybrid bricks/online. Surprise/delight/NOW! is the proper provide of the pure bricks retailer (are there still any of these?) and hybrid/bricks/online. [BTW, ALL the hybrids, in my opinion, are far from well done.] Taken in this context, of course malls have a long and prosperous future, as both entertainment venues (shopping can be entertainment, obviously,) but also for things that are needed RIGHT NOW!, no delays acceptable. The NOW! feeds into the mall (and most self-service retail) as a warehouse, stocking the LONG tail, where anything… Read more »
Vahe Katros
Guest
2 years 10 months ago
This question had me looking for the reasons why we don’t have World’s Fairs anymore. Here is one of many items found on the subject. Back to retail. The mall is not just a place, it’s a business concept and business model that helped an ecosystem of chain stores economically place venues in the suburbs to support a world that drove cars, watched TV, and bought the same stuff. It came of age when consumers remembered a dim past and had a bright future, with no fear of credit. That had me look back to the roots of all this – the original shopping mall, the Agora (def): “The Agora (/ r /; Ancient Greek: Agor ) was a central spot in ancient Greek city-states. The literal meaning of the word is “gathering place” or “assembly”. The agora was the center of athletic, artistic, spiritual and political life of the city.” What, the summary description from Wikipedia doesn’t include its role as the marketplace? It’s as if the Agora existed for reasons other than shopping?… Read more »
Kenneth Leung
Guest
2 years 10 months ago

Malls by definition are concentrated retail, and there will always be a need for that from a convenience perspective since “going shopping” is still considered a non-work leisure activity. Traditional malls built around anchor stores are now built around entertainment and dining (come for dining, shop before or after), or used as a community gathering space. Older format malls in obsolete locations will need to be re-purposed/redeveloped, there isn’t a good way around that unfortunately.

Lee Kent
Guest
2 years 10 months ago
Lifestyle centers are popping up all over Atlanta but the Malls, primarily the high end Malls, still thrive. I see many of these malls as destination while many of the lifestyle centers are more local. What makes the lifestyle centers click is the ambiance of walking along a sidewalk and sitting outside, when the weather is nice, to dine. There are usually events going on the weekends, like art shows, jazz festivals, cooking competitions, tastes of the local restaurants, yoga on the lawn, etc. A great place to feel like you are actually a part of a neighborhood. Long since lost in sprawling Atlanta. But, I can’t say this without mentioning that Atlanta is going through a big “citification” era. What this means is that many of us have grown tired of all of our tax dollars going to other parts of the county and never being spent on our parts, so we have incorporated and formed cities, removing us from the county control. This citihood gives us all the more reason to want to… Read more »
Gordon Arnold
Guest
2 years 10 months ago
I had the pleasure of visiting Bethlehem, PA to do dome holiday shopping with my wife this past December. As some of you may recall this was a city designed and built to make steel for the 20th century wars that we participated in. Today there is an influx of new city dwellers and merchants utilizing the old steel mills and support warehouses to create communal or leased shopping boutiques which includes some light specialty manufacturing. It is my observation from conversations with the merchants that much of the participation by retailers is seasonal. Those making a year around effort rely heavily on e-commerce for online direct and/or wholesale marketing plus purchasing the goods and materials they need for the businesses. The big malls in the suburbs are trying anything and everything to ramp up leases and consumer traffic. The 20th century retail methods and outlets are seemingly pushed aside for many speculative reasons as we see in this and previous discussions. Migration from the suburbs to the city supports much of the problems with… Read more »
Kai Clarke
Guest
2 years 9 months ago

This is a dubious conclusion, since it rides on the return to the old style neighborhoods. Outdoor life centers are really traditional neighborhoods, revived and renewed. Go to any large, traditional city, from Boston to Chicago to Philadelphia, and these neighborhoods are still alive and well.

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