"Malls are dying" seems like a "the suit is back" sort of meme. I've literally been hearing this for 20+ years. And the mall near me seems busier than ever. Someone must be pushing this for some reason. People shorting mall real estate?
I used to work next to a mall that literally went out of business and was torn down. The mall in my hometown has the highest vacancy rate I've ever seen.
My guess is that they are collectively dying, but that the severity of symptoms is not evenly distributed.
In our current "age of big data" is there a source of data that would show the number of malls as a function of time? It would also be interesting to know the trend of vacancy in malls over time, and things like average number of outlets in malls over time. Where would someone mine data like that?
The people shorting malls have already made out like bandits. Mall operators are very close to bankruptcy. Macerich down 85% in the past five years, Simon down 70%, Alexander Baldwin down 70%...it is already over. Once these places lose their main tenant, it all shuts down.
You haven't been hearing it twenty years either. Some people were putting on this trade in the early 2010s but this trade really picked up around 2018/19, when it became apparent that the situation was irreparable. Before that point, the "smart trade" was long malls...most of these people got wiped out (Bill Ackman more than once in TGT than JCP, Lampert in Sears...the trade that worked in 2004 went to zero by 2014).
You can also look at countries which have higher online share of retail, they are further down this path. In the UK, these places are just being boarded up (retail parks, what you would call strip malls in the US are thriving however). One mall near me with tens of units traded for $200k, that was worth $10m a few years ago. The largest mall operator (which owns almost all the top 20 largest malls) is in BK.
But the easy money has been made. Yesterday's news. The money is in redeveloping/converting these places into mixed-use and offices.
From 2000: "Retail Darwinism Puts Old Malls in Jeopardy"
"The fully enclosed shopping mall, that island of boxy chain stores and lost apostrophes in a sea of asphalt, was not born in California. But this seems to be the place where people are digging its grave, at least in its present form."
The reason seems to be provincialism and extrapolation of their lived experiences as universal. One thing I noticed with relatively little travel in my life is that the one thing you cannot tell easily is if something in your home region is common in other places.
The suit may well have a stake through its heart on the west coast. It never died in the east coast mega-metrapolisis group from Wall Street/NYC and Washington DC setting the norms.
Similiarly suburban malls are generally either sickly at best or maybe a bunch of high end outlets /might/ survive or could go the way of strip malls in a few decades. Urban malls tend to be vibrant in comparison as the limited big box store viability means that if it isn't viable to do a particular store at street level retail small stores for whatever reason the mall is the perfect place to locate them.
Pretty sure that "Malls are dying" is large part negativity bias - cities don't get "too crowded" with malls, so we never experience having "too many" of them, but we DO experience having them close down. A mall closing down will stick out much more to a person than a new one coming up.
It doesn't help that malls are practically designed to get old and decrepit - malls are built to a completed state - once one is built, it will never get "bigger, newer, and better", it will only get more and more older and "outdated". They weren't DESIGNED to be updated and last for decades.
where? here our malls have gotten massive updates, expansions and renovations over the years, not one is closed that would be a waste of a busy business...
It seems to entirely depend on good mall management honestly. The mall near me is a Simon mall ($SPG) and it’s doing great. Part of that is because they refuse to have vacancies and seem to actively recruit appealing businesses to locate there.
Is there a good way to quantify? There are also endless youtube videos of all manner of abandoned structures in Detroit, but I don't know that extrapolates to things outside of Detroit for example.
yup here they keep building more malls and all i hear is malls are dying... they build a mall almost in the middle of no where and yet its still busy. Just recently they built a mall next to a busy mall...
theresistor|4 years ago
My guess is that they are collectively dying, but that the severity of symptoms is not evenly distributed.
flubert|4 years ago
hogFeast|4 years ago
You haven't been hearing it twenty years either. Some people were putting on this trade in the early 2010s but this trade really picked up around 2018/19, when it became apparent that the situation was irreparable. Before that point, the "smart trade" was long malls...most of these people got wiped out (Bill Ackman more than once in TGT than JCP, Lampert in Sears...the trade that worked in 2004 went to zero by 2014).
You can also look at countries which have higher online share of retail, they are further down this path. In the UK, these places are just being boarded up (retail parks, what you would call strip malls in the US are thriving however). One mall near me with tens of units traded for $200k, that was worth $10m a few years ago. The largest mall operator (which owns almost all the top 20 largest malls) is in BK.
But the easy money has been made. Yesterday's news. The money is in redeveloping/converting these places into mixed-use and offices.
flubert|4 years ago
Back in the year 2000, someone created the Deadmalls.com website:
https://en.wikipedia.org/wiki/Deadmalls.com
...just a few random items from DDG:
From 2000: "Retail Darwinism Puts Old Malls in Jeopardy"
"The fully enclosed shopping mall, that island of boxy chain stores and lost apostrophes in a sea of asphalt, was not born in California. But this seems to be the place where people are digging its grave, at least in its present form."
https://web.archive.org/web/20150527125625/https://www.nytim...
From 2001: "Dying shopping malls reborn as old-fashioned downtowns"
https://www.berkeleydailyplanet.com/issue/2001-12-12/article...
From 2003: "Malls: Death of an American icon"
https://web.archive.org/web/20030707142032/https://money.cnn...
Cory Doctorow was talking about dead malls in 2003:
https://boingboing.net/2003/04/19/dead-mall-contest-re.html
From 1998: "Enclosed malls losing luster as well as tenants"
"Mintz thinks the vacancies signal a deeper problem -- that malls are outdated and out of touch with the needs of today's shoppers."
https://www.bizjournals.com/kansascity/stories/1998/02/09/st...
And it turns out there was a book published in 2002:
"Greyfields into Goldfields: Dead Malls become Living Neighborhoods"
https://www.amazon.com/Greyfields-into-Goldfields-become-Nei...
Nasrudith|4 years ago
The suit may well have a stake through its heart on the west coast. It never died in the east coast mega-metrapolisis group from Wall Street/NYC and Washington DC setting the norms.
Similiarly suburban malls are generally either sickly at best or maybe a bunch of high end outlets /might/ survive or could go the way of strip malls in a few decades. Urban malls tend to be vibrant in comparison as the limited big box store viability means that if it isn't viable to do a particular store at street level retail small stores for whatever reason the mall is the perfect place to locate them.
BariumBlue|4 years ago
It doesn't help that malls are practically designed to get old and decrepit - malls are built to a completed state - once one is built, it will never get "bigger, newer, and better", it will only get more and more older and "outdated". They weren't DESIGNED to be updated and last for decades.
emkoemko|4 years ago
flubert|4 years ago
...seems like 4 years is enough time to get a feel for things.
redfern314|4 years ago
Original: https://www.wsj.com/articles/mall-short-seller-shuts-down-be...
Different fund who raked it in: https://www.esquire.com/news-politics/a34785141/shopping-mal...
brightball|4 years ago
Many malls in nearby towns are filing bankruptcy.
unknown|4 years ago
[deleted]
ZanyProgrammer|4 years ago
flubert|4 years ago
nkozyra|4 years ago
They're definitely not surviving as they did in the 70s - 00s
ZanyProgrammer|4 years ago
emkoemko|4 years ago
where are malls dying?