Diversification Key For Mall Developers As Retail Landscape Evolves

The difficulties facing traditional retailers are many — and they’re changing the very nature of American shopping malls. Traditional anchors like Sears/Kmart and Macy’s are beset by competition from all sides, from freestanding big-box outlets (think Home Depot and Bed Bath & Beyond), to stores attracting fashion-forward yet price-conscious consumers (Target and Kohl’s) to mounting online competition from Amazon and others. This is leading to the loss of mall tenants, especially anchor tenants, which are major drivers of all-important foot traffic. As a result, American malls stand at a crossroads, with some simply being demolished while others are in various stages of reinvention. Mall owners are (or should be) rethinking the very definition of a mall. New tenants such as high-end restaurants, amusement parks, spas, health clubs, online pickup locations at traditional retailers and upscale movie theaters increasingly are essential components. Whole Foods, the high-end supermarket, recently became a tenant in a Los Angeles mall, and urgent care medical locations and other healthcare providers — which can benefit from low rents while providing medical service closer to people who don’t live near centralized medical campuses — have also taken root in some shopping centers. Read more at Retail Dive.