The Fate of Enclosed Shopping Malls in Tertiary Locations

The Fate of Enclosed Shopping Malls

Oct-32008

The Fate of Enclosed Shopping Malls in Tertiary Locations

Throughout the United States

The advent of the Internet has brought about a change in shopping patterns throughout the United States. In addition, another precipitating factor in the change in shopping patterns has been a recent large run-up in gasoline prices which make consumers think twice about driving 30 miles to shop for an item they can purchase on-line.

Furthermore, the demographics of the United States are changing as the baby boom generation ages and is replaced by the "Millennials" as the primary target for retailers. It appears that Millennials (those born in the late 1970's till the end of the 20th century) prefer lifestyle centers, where they can take in a movie and eat as well as shop, as opposed to strictly shopping in enclosed shopping malls. Additionally the "other" major demographic, Baby Boomers, also prefer the lifestyle center concept. These demographics are the target audience for retailers and modern society is rendering the enclosed shopping malls obsolete and not able to compete with newer retail concepts.

Is there life for enclosed shopping malls in tertiary areas of the United States?

These properties are generally located in close proximity to interstate highways and were built under the premise that Americans love to drive and shop. With changing demographics, these centers will have to adapt to lifestyle changes. What enclosed shopping malls have in their favor are that they generally have a superior location in a particular town and/or county and have often been a destination location for people in a particular region for the past thirty to fifty years or so.

Major components in favor of the re-tooling of the enclosed shopping malls are

The Baby Boomer generation is aging, becoming less mobile and are familiar with and often nostalgic about malls

Generation X'ers and Millennials are searching for people-oriented experiences to complement their often solitary experiences on-line

People, for the most part, like to congregate with other people and feel less alienated when they are socially interacting.

How can an enclosed shopping mall answer the needs of the general U.S. population?

First, housing components can be added to shopping malls to accommodate aging Boomers who need to be closer to day to day amenities like food shopping, restaurants, entertainment venues, physical therapy centers, health spas, continuing education programs and dry cleaners. These are services that are, for the most part, not associated with enclosed shopping malls.

The first step in re-assessing a particular enclosed shopping mall is to examine the existing housing needs of a particular community ( e.g., is their existing housing stock primarily owned or rental product,

is it upscale, middle income or downscale?). The Shopping mall can provide a new housing experience for both young and old consumers depending upon how the units are configured. In general, the plus of many enclosed shopping malls are that they are centrally located and have large tracts of land that can be re-developed into true "Town Centers" that contribute to a sense of community in a particular town and/or county.

What are many suburbs in the United States lacking?

Sociologically, much of America has become alienated with its lack of true community; its youth "hang out" in shopping malls, convenience stores, and strip centers without aim or purpose. In some ways, the enclosed shopping mall contributed to this alienation and it may well be the answer to this pernicious problem.

Communities need a binding and a feeling of togetherness that people can bring to each other. The shopping mall often brought people together in pursuit of a common American interest: shopping.

There are now other areas that the same Mall can provide to people: Entertainment, in the form of movies and other art forms such as Art, Theater and Music. The re-configured Mall can also potentially provide Education in the form of continuing education programs for seniors and under-skilled adults (as well as people interested in just continuing their education). Educational services can be provided by an existing college or university nearby that establishes an off-site facility at the local Mall.

The enclosed shopping mall mixed use re-development could be a viable solution to the need for well constructed housing to service an aging population. This type of housing would be targeted to people that simply want to live near other people and not isolated in either rural settings or overcrowded in highly urban situations, What would a typical shopping mall re-development entail?

The most important non-retail component of the mixed use development is housing.

As mentioned above, the demographics of a particular community, including any population growth or decline projections, as well as the existing housing stock has to be examined to determine the optimal housing needs. Even if a community's population is declining, an enclosed shopping mall location can still be quite viable if properly re-developed.

A second determining factor in creating a Town Square or Center is the need for the right kind of food market to service the new housing stock. In certain upscale locations, an organic supermarket might be preferred, while in a more middle income demographic a somewhat more traditional supermarket would be more appropriate. For this reason, it is very important to accurately assess the current and future demographics of a particular community.

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