What's killing shopping malls?

[lpetrich]

Never Mind the Internet. Here’s What’s Killing Malls. - The New York Times - "Yes, the internet has changed the way we shop. But taken together, other factors have caused greater harm to traditional retail stores, an economist says."

It has been a tough decade for brick-and-mortar retailers, and matters seem only to be getting worse.

Despite a strong consumer economy, physical retailers closed more than 9,000 stores in 2019 — more than the total in 2018, which surpassed the record of 2017. Already this year, retailers have announced more than 1,200 more intended closings, including 125 Macy’s stores.

Internet shopping has grown enormously, but it's still only 11% of the retail total.

Furthermore, more than 70 percent of retail spending in the United States is in categories that have had slow encroachment from the internet, either because of the nature of the product or because of laws or regulations that govern distribution. This includes spending on automobiles, gasoline, home improvement and garden supplies, drugs and pharmacy, food and drink.

The other factors:

• Big Box stores - they are bigger than online commerce.
• Income inequality - as it increases, the middle class is left with less money to spend.
• Services Instead of Things - education, entertainment, business services, etc.

 

[Jolly_Penguin]

#YangGang 2024

 

[Loren Pechtel]

An interesting trend I've seen: Every indoor mall around here is in a bad way. However, we have multiple recent outdoor malls that seem to be faring much better. I'm wondering if the ability to drive a lot closer to the door has something to do with it.

 

[Bronzeage]

I saw my first indoor mall sometime around 1966 in Vicksburg, MS. It was quite small by modern standards. The biggest store was a Sears. When I returned to Vicksburg in 1978, it was no longer a shopping mall. Some government agency had converted it to an office complex. Another mall was then in operation. Ever since malls have been a marketing concept, everyone has seen the rise and fall of many malls, long before the internet, big box stores, and I don't recall anytime people thought income was equal. If some resourceful economics grad student is looking for a thesis topic, I suggest researching the correlation between the death of a mall, and the life expectancy of industrial sized heating and air conditioning equipment.

The big retail chains from the 20th century are declining and I don't think there is a common element between them. Sears and Macy's don't occupy the same market segment. The problem with a mall is it is the most expensive retail space possible. This is especially true of the multilevel atrium style mall, complete with it's palm trees and water falls. The store operator pays for their retail space and the operating costs of heating and cooling a space nearly as large as the actual sales floor square footage. The big "anchor" stores have a symbiotic relationship with the Spencer's Gifts, the three dozen women's wear shops, and the fresh baked giant cookie stand. It's a business model which depends on high shopper traffic and the slightest drop in customers means marginal businesses have to shut down. As the anchor stores become marginal, the mall dies.

If anyone is looking for the core reason for mall mortality, it might be no more complicated than it was not a really good idea to begin with and only succeeds when all circumstances are optimal.

 

[angelo]

What's killing shopping malls? Online shopping for one. Too many retailers selling the same items the other. High wages with penalty rates, and high rents, is another major factor. But Shopping malls will still be around for the foreseeable future.

 

[Metaphor]

Non.


Shopping malls began to decline in popularity after several teenagers were killed by robotic droids that had circuits scrambled by lightning, as detailed in the documentary "Chopping Mall".

 

[funinspace]

I saw my first indoor mall sometime around 1966 in Vicksburg, MS. It was quite small by modern standards. The biggest store was a Sears. When I returned to Vicksburg in 1978, it was no longer a shopping mall. Some government agency had converted it to an office complex. Another mall was then in operation. Ever since malls have been a marketing concept, everyone has seen the rise and fall of many malls, long before the internet, big box stores, and I don't recall anytime people thought income was equal. If some resourceful economics grad student is looking for a thesis topic, I suggest researching the correlation between the death of a mall, and the life expectancy of industrial sized heating and air conditioning equipment.

The big retail chains from the 20th century are declining and I don't think there is a common element between them. Sears and Macy's don't occupy the same market segment. The problem with a mall is it is the most expensive retail space possible. This is especially true of the multilevel atrium style mall, complete with it's palm trees and water falls. The store operator pays for their retail space and the operating costs of heating and cooling a space nearly as large as the actual sales floor square footage. The big "anchor" stores have a symbiotic relationship with the Spencer's Gifts, the three dozen women's wear shops, and the fresh baked giant cookie stand. It's a business model which depends on high shopper traffic and the slightest drop in customers means marginal businesses have to shut down. As the anchor stores become marginal, the mall dies.

If anyone is looking for the core reason for mall mortality, it might be no more complicated than it was not a really good idea to begin with and only succeeds when all circumstances are optimal.

Yup...something about death and taxes comes to mind. My parents would talk of the decline/death of Filene's Department Store in Boston (and of course Filene's Basement).

[YOUTUBE]https://www.youtube.com/watch?v=uTLcZDY9pzs[/YOUTUBE]

 

[fromderinside]

... nd the atlantic Monthly screws up again.

https://www.theatlantic.com/technol...en-malls-saved-cities-from-capitalism/553610/

“Okay, we’ll see you in two-and-a-half hours,” the clerk tells me, taking the iPhone from my hand. I’m at the Apple Store, availing myself of a cheap smartphone battery replacement, an offer the company made after taking heat for deliberately slowing down devices. A test run by a young woman typing at a feverish, unnatural pace on an iPad confirms that mine desperately needed the swap. As she typed, I panicked. What will I do in the mall for so long, and without a phone? How far the mall has fallen that I rack my brain for something to do here.Sign up for The Atlantic Politics & Policy Daily.
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The Apple Store captures everything I don’t like about today’s mall. A trip here is never easy—the place is packed and chaotic, even on weekdays. It runs by its own private logic, cashier and help desks replaced by roving youths in seasonally changing, colored T-shirts holding iPads, directing traffic.
Apple operates some stand-alone retail locations, including a glass cube entrance in midtown Manhattan and a laptop-shaped location on Chicago’s Michigan Avenue. But a lot of the stores are located in shopping malls. The Apple Store is one of the only reasons I go to the mall anymore. Usually I get in and out as fast as I can. But today I’m stuck.






When all is said and done, it turns out to be a strange relief. Contrary to popular opinion, malls are great, and they always were.

---

The tragic story of the American shopping mall is well-known by now. Victor Gruen, an Austrian-born architect, emigrated to the United States after Germany’s annexation of Austria in 1938. In 1954 he designed the first outdoor suburban shopping plaza, near Detroit. Two years later, in 1956, the Gruen-designed Southdale Center opened in Edina, Minnesota.

Nope

http://uptownrichland.com/

The Uptown Shopping Center was created, at least in plan, by the Atomic Energy Commission of the United States and the Richland Community Council (precursor to the City of Richland) as a Master Planned development in 1948. The plan called for the creation of a second commercial facility area, one-mile north of the original downtown (present day Parkway Shopping Center) to provide additional amenities for residents ahead of formal incorporation of the City. The Uptown officially started on May 10th, 1949 with the opening of Dawson-Richards Men and Boys Store, soon followed by Frank Berry’s Sporting Goods and the National Bank of Commerce.
Many more retail and household goods stores opened in the succeeding months, and in 1950 construction began on the Uptown Theatre as a nucleus of entertainment for Hanford workers and City residents. The Atomic Energy Commission continued to build new buildings for retail stores and restaurants, and issue contracts for individuals to operate those entities. As incorporation of Richland neared a final vote and congressional authority, the Atomic Energy Commission began to transition the Uptown to individual and collective ownership. Each property owner was granted deed to their own property and an undivided interest in the deed to the surrounding parking lot and alleyways.

 

[fromderinside]

Wow. Was that F'd up. only the last paragraph in the Atlantic article should be there.

 

[prideandfall]

i wonder whether the social aspect is significant enough to be a viable contributing factor.
when i was a teen in the early/mid 90s the malls were major social hubs, places that everyone knew were gathering areas and where other people would be, and after school or on a weekend simply going to the mall and hanging out there all day was how you'd end up meeting other kids and socializing.
i know there's going to be an argument about the indigent youths scaring off real customers, but from the perspective of a mall rat it always felt like it drove more business than it scared away. when you spend all day at the mall, you gotta come up with some scratch to buy lunch, and all the window shopping gives you ideas for stuff you want.

i wonder too about specificity: i have this notion that when i was growing up the mall was full of useful shops, if not necessarily in terms of downright pragmatism at least in terms of access to things you'd want but may have trouble finding elsewhere.
(ie: spencer's gifts for novelty crap, or the hallmark store for a shitload of cards, or the weird asian themed place for knick knacks and cheap crappy katanas)
the last time i was in a mall it seemed it was a series of insanely specialized novelty stores that didn't really even have anything in them. i swear to god i saw an entire store recently that had like 3 hand bags and a pair of boots and that's it. or a store location with 2 cars in it. or a place that sold nothing but multi-hundred-dollar watches.
i have no idea how the hell such places could possibly be economically viable on their own, so i just assumed they were strategic money-loss gambles in order to get brand recognition.
but, that's not a winning strategy to sustain the mall business model long term. it's also a long pointless digression.

so anyways yeah, as social media replaced "going to a place and interacting with other random people" as the thing the young kids are doing and increased niche offerings became the norm, i wonder how much that impacted malls on top of the more obvious economic changes.

 

[Loren Pechtel]

The big retail chains from the 20th century are declining and I don't think there is a common element between them. Sears and Macy's don't occupy the same market segment. The problem with a mall is it is the most expensive retail space possible. This is especially true of the multilevel atrium style mall, complete with it's palm trees and water falls. The store operator pays for their retail space and the operating costs of heating and cooling a space nearly as large as the actual sales floor square footage. The big "anchor" stores have a symbiotic relationship with the Spencer's Gifts, the three dozen women's wear shops, and the fresh baked giant cookie stand. It's a business model which depends on high shopper traffic and the slightest drop in customers means marginal businesses have to shut down. As the anchor stores become marginal, the mall dies.

I would think the mall would be cheaper to heat/cool than the same amount of retail space in a bunch of separate stores. The volume that is controlled is only relevant if you need to bring it to the correct temperature, otherwise it's all about inputs and outputs. Your inputs are the floor/walls/roof and the heat released by all the equipment & people inside. (In operation the Mall of America does not need heating even in mid-winter.)

Furthermore, you have less entry/exit to the temperature controlled space and it's more common to see doubled doors on mall entrances than store entrances.

As for the death of the anchors--I'm thinking of the closest indoor mall. Every anchor that has closed had previously closed another store around town that wasn't in the mall.

 

[T.G.G. Moogly]

The last mall built around here has been a disaster. The surrounding establishments aren't doing too badly but the mall itself started to fail quickly when stores moved out. There were grandiose plans to make it a destination vacation, plans which never materialized because it wasn't attracting enough spending. So now a few stores are left but it was recently sold at a great loss to the original developer, something everyone around here knew was going to happen.

It's a strange place to walk through because there are so few people there, it's spooky actually.

 

[crazyfingers]

Except for grocery and regular household supplies I very rarely go shopping.

This is because I got sick of going to 5 different stores and still to find that they don't have what I am looking for. Assortment sucks. So I go online.

 

[DBT]

Malls seem to be doing well enough here....maybe climate plays a part in that people prefer to shop in air conditioned comfort than tropical heat and humidity in town.

 

[bilby]

Malls seem to be doing well enough here....maybe climate plays a part in that people prefer to shop in air conditioned comfort than tropical heat and humidity in town.

In SEQ, Westfield keep throwing up bigger and bigger malls, and they appear to be booming.

The new Westfield at Upper Coomera is insanely large; And Robina Town Centre keeps on getting bigger. At Robina, they have two secret sub-levels, so that customers never need see a deliveryman. LG1 is a warren of passageways that link to back doors of all the shops; LG2 is literally big enough to drive a truck into - there's a 4.5m clearance, and a couple of dozen loading docks. Making a delivery there is quite a surreal experience.

 

[Derec]

One of the better Atlanta malls, Lenox Square, recently had some bad piublicity with three shootings. Two in the parking lot, one in the food court. All three related to robberies I think.
1 arrested, 1 at-large for Lenox Square shooting

That's not exactly going to attract punters. Then there is suburban Gwinnett Place which has really fallen on hard times and is now mostly used to film Stranger Things.

Another thing I have noticed is the rise of the outdoor shopping center designed to look like a Main Street, with limited parking right in front of the tree-lined streets (and more in the back of the stores as well).
They look like this:

And they tend to be more focused on restaurants rather than mostly retail stores. It's also a more mixed use space.

 

[TV and credit cards]

Jeff bought a number of our malls, razed them and stuck Amazon fulfillment and distribution centers in their place.

People love the outdoor shopping here, especially around Christmas. And the residential real estate surrounding it commands about a 30% price premium. I don’t know if I would want to own a home where no small part of it’s valuation was tied to a shopping area.

 

[angelo]

One thing why most decent malls remain popular, and in most cases thrive, is the fact they have a huge variety of different foods and beverages in their food halls. One of The biggest [so far] malls here in Perth is Joondelup which even houses a well patronised tavern.

My local Mall, Galleria Morley used to be the largest in the state. But plans are afoot to refurbish it and again make it the largest. They're concentrating on cafes and restaurants of all types in a garden promenade style structure. But the refurbishments which should have been completed by now have been put back again and again because of the business downturn.

 

[rousseau]

I'd guess that the bread and butter of many malls that are still around is clothing. That may be one of the few things that people prefer to buy in person, rather than online. At the mall I visit, which is still thriving, about 90% of the shops are clothing stores.

 

[angelo]

I've bought two pair leather shoes online. The quality was exemplary. But one pair was too tight, and the other too big. I specified size 9 UK on both occasions. Needless to say, I'll never buy shoes online again.

But I've had nothing to complain about buying prescription glasses online, and saved hundreds of dollars in the bargain. The trick is to go to an optician to get a script, by law they have to give it to you. [ make sure the PD is included in the script] Then go online to the many online spec retailers.

I've bought perhaps more than 2 dozen specs over the years from a company called Selectspecs. I've yet to receive a dud pair, or something I wasn't happy with. As for adjustment. Once you receive your order, in most cases, around 3 weeks maximum, if glasses don't fit properly. Take them to any optician who'll adjust them for free.