What’s a dead mall and why should you care?
As new malls open in cities, the shine wears off of the older malls, patron shuffle over to the shiny and the older may end up closing as lease holders jump ship to newer areas. In other words, it dies. This typically happens in areas of town that are declining or that were overbuilt with retail space.
When a mall begins dying, it’s like a virus. But it doesn’t always happen in declining areas, some of the pictures below are of the Gateway Center in Austin which is in an upscale area but happens to have been hit by some big box bankruptcies. The end of the center is vacant and has been for some time, but the virus is in the decline of the buildings as lease holders are not keeping the buildings up anymore and strip mall or traditional mall owners are too strapped for cash (because of the rising vacancy rates) to do basic upkeep (regardless of what CAM other leases are paying).
This all matters because residential agents make recommendations to home buyers and sellers based on all surroundings, including dead malls.
What can we do?
As an industry, we need to get creative. Not just on a single mall basis, but overall by pushing for legislation that allows grants for repurposing of dead spaces before they fall into such disrepair that they’ll be required to be bulldozed rather then repurposed (which isn’t exactly the most environmentally friendly move as it wastes a perfectly good shell building).
What could a dead mall become? Here in Austin, a mall that is no longer the city’s diamond mall (aka no one goes there anymore) may be redone to be a community college campus rather than demolished. Dead malls can become office buildings in areas where that is beneficial, or can become community center or indoor amusement centers. Right now, the commercial sector has no incentive to repurpose, it’s actually cheaper, faster and higher return to simply demolish, but to be honest, dead malls are frowned upon and typically continue falling into disarray.
What are some ways that our industry could help to repurpose dead malls? What are YOUR ideas?