MALLS ARE STILL OUT THERE - HOW ARE WE USING THEM?
Written by: Gracie Criger
Gracie is a student at The University of Cincinnati studying Real Estate. She is currently interning with Colliers | Columbus on the research team. Keep reading for her take on the future of malls.
All over the country, malls are being configured into new concepts. 99 percent of consumer goods companies say the pandemic accelerated their company's digital transformation leading to time for change.
Living, working, and shopping are all constants today. Talk of “mini cities” are consuming suburbs and existing malls. Malls are moving away from being complete retail focus and now including spaces like housing, civic and co-working spaces. Not only are they being reconfigured to accommodate these amenities, but new developments are being constructed to include an all-in-one lifestyle. Though this is efficient, not every mall is ready for this change.
Experts predict that two-thirds of purchases in 2023 will be ecommerce based. Since 1998, the number of malls has decreased from 42,000 to 1,000 equating to a decline of almost 98%. In 2019, the malls hit a 20-year low due to ecommerce and slow reaction rates of retailers. Just recently, customers are seeing a good balance of in-store pick up, in-store purchases, and delivery. The obvious decline of malls is happening, but some experts do not think they are “dead” yet.
Turning malls into multi-family housing along with office and a little retail; that is the new excitement. People are willing to pay to have endless amenities within steps. The convenience along with the newness of the idea is appealing. The $4 billion mall in Miami, American Dream Miami, is to be completed in 2026 including 3.2 million square feet of retail, 2,000 apartments, and one million square feet of office. When completed, this will be North America’s largest shopping mall. Considering the shift in the usage of space across all service lines, they each play a part. Office is needed for collaboration and a foundation for companies. Retail directly connects the end to the beginning of a specific manufacture and impacts the consumer. Industrial has an important part as it relates to both for storage and manufacturing. This new development megamall is an example of the upcoming shift.
There is no longer a general concept of mall design. They are changing with the times. In Austin, Texas, a mall was even transformed into a community college and in South Carolina, a former JC Penny was transformed into a medical university. The addition of apartments within malls allows more consistent foot traffic, which improves the sales of retail and indirectly, the other service lines. Though this is not a brand-new idea, it is becoming favored for the new working generation. Change is expected to increase greatly, and this is just the beginning of a concept that could potentially remove the term ‘mall’ from the vernacular.