News and Events
Malls: A Dying Breed? Don't Bet On It
The American Mall May Not Be the Retail Powerhouse it Used To Be, But Most Industry Executives Say Malls are Resilient and Evolving.
Mar 26, 2008 CoStar Group Sasha Pardy
Last week's retail article in CoStar Advisor, "Three Mall Owners Struggle With Pressure to Sell," led us to question the current health of the traditional American mall, especially given current market conditions as U.S. consumers tighten their purse strings on discretionary purchases, foregoing purchases that drive sales at mall retailers.
This week we present perspectives on the future of malls from several respected analysts and brokerage firms.
RCS REAL ESTATE ADVISORS Ivan Friedman, President and CEO of RCS Real Estate Advisors, a firm providing real estate disposition and consulting services to retailers across the country, said that he doesn't see malls as being more vulnerable than other retail property types in the current market, even considering those retailers that have announced store closings or gone bankrupt recently.
The major difference for a mall landlord now, Friedman explains, is "take Sharper Image for example, as they're closing 90 stores -- their locations are pretty much 50-yard line, 4,000 square feet, very wanted mall locations and a very wanted size. While landlords would normally have someone for that immediately, now they're saying 'it's great I get this back, but who do I have to rent it to?', because everybody has pulled back. However, if it's an A mall or a B+ mall, that space will go rather quickly, regardless."