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Dead mall
A dead mall, also known as a ghost mall or zombie mall, is a shopping mall that has low consumer traffic or is deteriorating in some manner.
Many malls in North America are considered "dead" when they have no surviving anchor store or successor that could attract people to the mall. Without the pedestrian traffic that department stores previously generated, sales volumes decline for almost all stores and rental revenues from those stores can no longer sustain the costly maintenance of the malls.
Structural changes in the department-store industry have also made survival of these malls difficult. These changes have contributed to some areas or suburbs having insufficient traditional department stores to fill all the existing larger-lease-area anchor spaces. A few large national chains have replaced many local and regional chains, and some national chains are defunct.
In the US and Canada, newer "big box" chains (also referred to as "category killers") such as Walmart, Target Corporation and Best Buy normally prefer purpose-built free-standing buildings rather than using mall-anchor spaces. Twenty-first-century retailing trends favor open air lifestyle centers; these centers resemble elements of power centers, big box stores, and strip malls; and (most disruptively for storefronts) online shopping over indoor malls. The massive change led Newsweek to declare the indoor mall format obsolete in 2008. The year 2007 marked the first time since the 1950s that no new malls were built in the United States. Most Canadian malls still remain indoors after renovations due to the harsh winter climate throughout most of the country; however, the Don Mills Centre was turned into an open-air shopping plaza. Attitudes about malls have also been changing. With changing priorities, people have less time to spend driving to and strolling through malls and, during the Great Recession, specialty stores offered what many shoppers saw as useless luxuries they could no longer afford. In this respect, big box stores and conventional strip malls have a time-saving advantage.
The number of dead malls has increased significantly because the economic health of malls across the United States has been in decline, with high vacancy rates in many of these malls. From 2006 to 2010, the percentage of malls that are considered to be "dying" by real estate experts (have a vacancy rate of at least 40%), unhealthy (20–40%), or in trouble (10-20%) all increased greatly, and these high vacancy rates only partially decreased from 2010 to 2014. In 2014, nearly 3% of all malls in the United States were considered to be "dying" (40% or higher vacancy rates) and nearly one-fifth of all malls had vacancy rates considered "troubling" (10% or higher).
Some real estate experts say the "fundamental problem" is a glut of malls in many parts of the country creating a market that is "extremely over-retailed". Cowen Research reported that the number of malls in the U.S. grew more than twice as fast as the population between 1970 and 2015; Cowen also reported that shopping center "gross leasable area" in the U.S. is 40 percent more shopping space per capita than Canada and five times more than the U.K.
Some malls have maintained profitability, particularly in areas with frequent inclement weather (or otherwise weather undesirable for outdoor activities, such as shopping in an open-air shopping/lifestyle center)[citation needed] or large populations of senior citizens who can partake in mall walking. Combined with lower rents, these factors have led to companies like Simon Malls enjoying high profits and occupancy averages of 92%. Some retailers have also begun to re-evaluate the mall environment, a positive sign for the industry.
A retail apocalypse that started in the 2010s made the dead mall situation even more noticeable. This is due to the complete closing of several retailers, as well as anchor tenants Macy's and JCPenney closing many locations and the sharp decline in Sears Holdings. The trend was particularly noticeable when Pittsburgh Mills, a mall once worth as much as $190 million, was sold at a foreclosure sale for $100, with the mall itself being purchased by lien holder Wells Fargo.
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Dead mall
A dead mall, also known as a ghost mall or zombie mall, is a shopping mall that has low consumer traffic or is deteriorating in some manner.
Many malls in North America are considered "dead" when they have no surviving anchor store or successor that could attract people to the mall. Without the pedestrian traffic that department stores previously generated, sales volumes decline for almost all stores and rental revenues from those stores can no longer sustain the costly maintenance of the malls.
Structural changes in the department-store industry have also made survival of these malls difficult. These changes have contributed to some areas or suburbs having insufficient traditional department stores to fill all the existing larger-lease-area anchor spaces. A few large national chains have replaced many local and regional chains, and some national chains are defunct.
In the US and Canada, newer "big box" chains (also referred to as "category killers") such as Walmart, Target Corporation and Best Buy normally prefer purpose-built free-standing buildings rather than using mall-anchor spaces. Twenty-first-century retailing trends favor open air lifestyle centers; these centers resemble elements of power centers, big box stores, and strip malls; and (most disruptively for storefronts) online shopping over indoor malls. The massive change led Newsweek to declare the indoor mall format obsolete in 2008. The year 2007 marked the first time since the 1950s that no new malls were built in the United States. Most Canadian malls still remain indoors after renovations due to the harsh winter climate throughout most of the country; however, the Don Mills Centre was turned into an open-air shopping plaza. Attitudes about malls have also been changing. With changing priorities, people have less time to spend driving to and strolling through malls and, during the Great Recession, specialty stores offered what many shoppers saw as useless luxuries they could no longer afford. In this respect, big box stores and conventional strip malls have a time-saving advantage.
The number of dead malls has increased significantly because the economic health of malls across the United States has been in decline, with high vacancy rates in many of these malls. From 2006 to 2010, the percentage of malls that are considered to be "dying" by real estate experts (have a vacancy rate of at least 40%), unhealthy (20–40%), or in trouble (10-20%) all increased greatly, and these high vacancy rates only partially decreased from 2010 to 2014. In 2014, nearly 3% of all malls in the United States were considered to be "dying" (40% or higher vacancy rates) and nearly one-fifth of all malls had vacancy rates considered "troubling" (10% or higher).
Some real estate experts say the "fundamental problem" is a glut of malls in many parts of the country creating a market that is "extremely over-retailed". Cowen Research reported that the number of malls in the U.S. grew more than twice as fast as the population between 1970 and 2015; Cowen also reported that shopping center "gross leasable area" in the U.S. is 40 percent more shopping space per capita than Canada and five times more than the U.K.
Some malls have maintained profitability, particularly in areas with frequent inclement weather (or otherwise weather undesirable for outdoor activities, such as shopping in an open-air shopping/lifestyle center)[citation needed] or large populations of senior citizens who can partake in mall walking. Combined with lower rents, these factors have led to companies like Simon Malls enjoying high profits and occupancy averages of 92%. Some retailers have also begun to re-evaluate the mall environment, a positive sign for the industry.
A retail apocalypse that started in the 2010s made the dead mall situation even more noticeable. This is due to the complete closing of several retailers, as well as anchor tenants Macy's and JCPenney closing many locations and the sharp decline in Sears Holdings. The trend was particularly noticeable when Pittsburgh Mills, a mall once worth as much as $190 million, was sold at a foreclosure sale for $100, with the mall itself being purchased by lien holder Wells Fargo.