With the boom in mall vacancies on the fast clip amid the boom in shopping online shopping, homeowners are quickly looking for other ways to reuse the glut of empty stores that will help boost traffic in shopping centers.
The rate of early vacancies hit a historic high of 9.8% in early September, surpassing the previous peak of 9.3% in 2011, according to data from research firm (RIIS) Capital Tics Analytics.
“I expect this rate to float upwards over the next five years,” said Victor Kelanog, head of commercial real estate economics with (RIS) capital analytics.
“The coronavirus crisis kicked the long-grown high gear of e-commerce,” Kelanog said. “As we begin to emerge from the epidemic, empty trends are very unlikely to turn to pre-Covid-19 levels,” he said.
The stakes are high for Mall developers, who are now replacing the vacant space in various ways.
Out of stores. In the doctor’s office fee.
In this environment, replacing a shutter store with another store is likely to be a backfire.
Alternatively, mall developers say they are focusing on businesses other than retailers to replace shutter stores, schools, doctors’ offices and short- and long-term storage facilities for residential and commercial customers.
Amy Ziff, director of National Retail at Time Equities, said, “Pre-Covid had a large array of retail spaces in the U.S.,” which owns and operates hundreds of retail properties in closed houses, free-standing stores and in the United States. . Open air malls.
“Now, the supply of available space is running out and the retailer’s demand is soft. So you have to be polite and creative about who to rent it to and go there and attract different types of tenants.”
In one of its assets – landings in Columbus, Georgia – Ziff said the company is signing leases with local retailers and restorators but noted that the portfolio of Time Equities has seen an increase in lease-signing doctors and dentist offices.
Landing is a complex of three shopping centers in Columbus, Georgia that includes approximately 300,000 square feet of open-air retail.
And at its indoor mall in Maryville, Tennessee, Ziff said the vacant JCPin store is also very interested in non-retail businesses, including tenants in health-care space.
“As mall opera operators, we can’t just sit on our hands and wait for people to come to us. We have to go out there and sell these ideas, because right now the supply is outpacing the demand for space.”
Desired: Micro warehouse
Shopping The popularity of online shopping and same-day delivery has also increased the demand for spaces to serve as final mile delivery fulfillment centers.
Ziff said retailers, including direct-to-customer sellers, are rushing to find vacancies near their customers in urban areas to build micro-warehouses to speed up delivery of orders.
“Empty stores in malls can be turned into these micro fulfillment centers,” he said.
Dan Nivim, co-founder of Avionos, which provides digital commerce expertise to companies, said using the empty mall space in stock inventory is a smart idea.
“Retailers are struggling to become super local so they can deliver to their customers more quickly,” Nive said. Empty stores in malls are already located close to customers and they have the infrastructure arranged.
In addition, he said retailers can set up micro warehouses so that they not only fulfill fulfillment centers for sending orders, but shoppers already come to the malls, so they can place orders and shop from the warehouse to the shoppers on the spot.
‘It’s about using the concept in many ways,’ he said.
Sear is left. Is entering a high school
Brookfield Properties, a subsidiary of Brookfield Property Partners and the country’s second-largest mall operator, is bringing a school to its mall.
The 70,000-square-foot Sears Anchor Store at its Grand Tetan Mall in Idaho Falls, Idaho is being rebuilt as a charter school to open in the fall of 2021.
Part of the mall’s parking lot will be converted into an outdoor play and entertainment area for students.
The school’s executive director, Michelle Bedley, said the Alturus International Academy, located in the Grand Tetan Mall, will have 600 to 6 students in grades.
“We wanted to start adding a high school, but we can’t afford to build a new school,” Ball said. “The excitement of taking up this large space which was a Sears store and renovating it excites us.”
To maintain safety, she said any entrances to the renovated space by the mall would be closed, he said.
Ball Lay said the new school’s location is a win-win because “we’re supporting a community here that needs a high school and can get more traffic because of the mall’s business.”
Once completed, the school at Grand Tetan Mall will not be the only mall school in the area. Another charter school, such as Prep Poctello, about an hour’s drive from Grand Tetan Mall, opened last year in the East Sears store at Pine Ridge Mall in Chubbach, Idaho.
Jeffrey Aronoff, senior vice president of leasing with Brookfield Properties, said the deal for the Alturus school was done with pre-epidemic in mind.
He said Brookfield is also looking to bring other tenants self-storage services, and indoor sports facilities such as soccer fields in the temple.
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