RETURN OF THE MALL

MAY 5, 2011 8:08 AM, BY ELAINE MISONZHNIK, RETAIL TRAFFIC ASSOCIATE EDITOR

The enclosed regional mall—the uniquely American retail property that sprang to life in the 1950s and 1960s—has been declared dead (or dying) for years.

Stephen D. Lebovitz, president and CEO of CBL & Associates Properties Inc., a Chattanooga, Tenn.-based regional mall REIT with an 82.1-million-square-foot portfolio, recalls conversations with tenants in the not-so-distant past in which retailers insisted their future lay elsewhere—at lifestyle centers or town centers or mixed-use projects. The experience was not limited to CBL—mall executives across the board were having similar discussions with their tenants. At the time, many believed the format had outgrown its usefulness and was out of step with modern customers. “A lot of the retailers went so far as to say they prefer lifestyle centers over regional malls,” Lebovitz says.

The list of grievances was long.

Malls were too large.

Their temperature-controlled environments were too artificial.

Department stores—the original conceit around which the concept was developed—were not the draws they once were.

Mall parking lots were too sprawling and mall parking garages too arduous to navigate.

Formats like power centers, lifestyle centers and mixed-use facilities were newer, hipper and more convenient.

And, of course, there was the constant growth of internet retail, which continues to slowly eat away at traditional retail channels.

In response to these factors, mall owners ...

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