Is the Shopping Mall a Dead Concept?
NAI Global Blog Post
May 18, 2010
At the start of the recession, regional malls were in a difficult position. Battling competition from online retailers and as people turned to lower-cost bulk items to save money, shopping malls lost a lot of foot traffic and were in danger of becoming extinct. New shopping mall developments were put on hold, and even mega-malls, like New Jersey’s Xanadu, had their plans scaled back significantly in an attempt to match consumer sentiment.
As the recession dragged on, big box retailers started to go out of business, followed by a number of their smaller retail cousins. Mall anchor stores like Macy’s, Nordstroms and JC Penney began to reevaluate their retail footprints and cut underperforming stores, and in some cases halt altogether their chain’s expansion. As the anchor stores closed, many of the smaller retailers that rely on that foot traffic to survive soon followed. Not to mention, chain stores like DVD retailers and toy retailers began to close as people turned to cheaper options like Target and Walmart for their DVD and toy purchases, further changing the shopping mall landscape. And in short order, a number of communities were faced with desolate shopping centers, driving up unemployment in the local area and creating an eyesore.
But is the shopping mall truly dead? Now that the recession is coming to a close and retailers are starting to see their sales numbers rebound, albeit at a very slow pace, does it hold that consumers will again flock to major shopping malls to spend their hard-earned cash? The short answer is yes and no.
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