Does the American Shopping Mall Have a Second Life?

Retailers have to customize the experience

Here’s how to have a good time at the local shopping mall,” a reviewer called Bunny E. posted on Yelp this past February. “Load the ‘Dawn of the Dead’ soundtrack on your MP3 player and go to the mall between 7-8 a.m. (before they even turn on all the lights). Hit play and immerse yourself in a post-apocalyptic nightmare world. And get some great exercise to boot!”

The shopping center Bunny E. reviewed is the massive, 1.5 million-square-foot, nearly empty Cincinnati Mall, in the northern suburbs of Ohio’s third largest city. It is one of hundreds of dead or dying indoor malls that dot the American landscape. Moms and dads who fondly remember teen years spent flirting at the mall now bring their kids to watch bulldozers flatten the dated buildings. Ironically, some of these zombie shopping malls have more nostalgic followers on Facebook and blogs like than they have actual shoppers.

Blame the recession, Amazon and unimaginative retailers. Offline stores are scrambling for “progressively smaller pieces of the retail pie as e-commerce relentlessly gains share in many categories,” says Jeff Jordan, general partner at venture capital firm Andreessen Horowitz. Circuit City, Borders, CompUSA, Tower Records and Blockbuster all folded their tents, and many others are showing signs of serious economic distress, he points out. “The mall and shopping center stalwarts are closing stores by the thousands, and there are few large physical chains opening stores to take their place.”

Some malls, however, are fighting back, using social media and inventive combinations of retail and community outlets. Doctors’ offices, clinics, churches, indoor sports fields, grassy parks and even schools are filling up big chunks of retail space and attracting potential shoppers. What’s more, just when you thought it was a goner, the traditional shopping mall format is surfacing in some unexpected places (think airport security). The trend reflects consumers’ growing interest in blending recreation, education and other activities with the brick-and-mortar shopping experience, say experts.

Shoppers clearly still care about the fate of these spaces. When the 45-year-old, 32-acre Miracle City Mall in Titusville, Fla., closed in February, a local organization with deep Facebook connections wooed developers with a rally in its sprawling parking lot. The Greater Titusville Renaissance committee was hoping for several hundred supporters-cum-shoppers—about 3,000 showed up, along with high school marching bands and food trucks. Some supporters carried signs that read, “If you come, we will shop.” Tentative plans for a new Miracle City Towne Center include five large stores (the old mall had two anchor stores), smaller shops and offices facing a small park and a tiled outdoor walkway. The new mall might also include doctors’ offices, an urgent-care clinic and restaurants, says Robin Fisher, Brevard County commissioner and point person on the redevelopment.

Social media has been crucial in driving the project forward. “Looking at our demographics doesn’t tell the whole story. We needed the developer to understand the community’s [hunger] for a nearby place to shop,” explains Fisher, adding that Facebook helped get residents connected to the developers. By April, a development partnership based in Columbus, Ohio, was attempting to buy the old mall and line up tenants for the new open-air center. Demolition has been set to begin by the end of this year.

In the past, shopping malls were always set up more for developers than retailers, says David Ginsburg, CEO of Downtown Cincinnati Inc., a business development nonprofit. His organization is helping push redevelopment plans for another dead Cincinnati mall, Tower Place, which shuttered in February. The city bought the property in foreclosure and is negotiating with a developer to turn it into a parking structure with stores at the street level. The old mall parking garage would be replaced with a 30-story residential tower, more parking and a supermarket, says Jeff McElravy, senior development officer at City of Cincinnati.

“We need to learn the lesson from the empty malls and make our new shopping centers adaptable for what residents will need in the future,” Ginsburg says. For now, brick-and-mortar stores will probably become a small part of community mixed-use malls, he adds.

Not everyone agrees. Mixed-use shopping hubs are a pipe dream, argues Don Wood, CEO of Federal Realty Investment Trust, which owns more than 80 shopping centers around the country. He says the towns around failed malls are not dense or high-income enough to support mixed-use projects. In addition, the projects are costly to build and require that developers have a wide range of experience in retail, office and residential, which is rare.

Recommended articles