More and more reports are coming out of the US about shopping malls that are closing and being abandoned. What’s interesting is that it’s mall based shopping that is challenged and not shopping itself. The New Yorker has an interesting report quoting Rick Caruso, CEO of the company with malls delivering best-practice per square metre sales. Caruso malls are outdoors and more about the LA lifestyle experience.
This trend is one we need to watch and assess whether it is unique to the US or something we are likely to see in Australia because right now, we’re seeing more malls being built than close – leading some to say we are over served with retail space.
There was a time when being in a newsagency in a shopping mall was the preferred outlet. Today, that preferred location is more likely to be a high street situation in an area with a strong sense of community.
Mark there is even a website dedicated to tracking them:
http://www.deadmalls.com/stories.html
Ive been following it for a while. It doesn’t make for good reading but it is difficult to determine how applicable it is to Australia. The US went through an enormous property value downturn a couple of years and we havent seen anything like that here so its hard to know how much of what happens there translates to here.
Thanks James. I had not seen that. I’m not sure how it plays out here given that we don’t have the strip malls and doe other retail situations they have. However, we are over-malled so I expect there will be some ramifications here at some point.
Hopefully it will have some effect on rents but this is unlikely to be seen as a solution to the greedy.
This I think is mainly an American Phenomenon, because more consumers are able to get what they want from Online Malls like Amazon (which is even doing groceries now).
Just some more info on the mall pictured, it started closing down in 2006 when target pulled out, and the rest of the mall has been mostly closed down in 2008.
http://en.wikipedia.org/wiki/Rolling_Acres_Mall
http://www.weather.com/travel/abandoned-malls-seph-lawless-photos-20140408
http://www.businessinsider.com/shopping-malls-are-going-extinct-2014-1
Alex online is having a similar impact here – just ask anyone in fashion retail.
mark-
true I forgot about them….