The Future of Malls in America

NEW YORK CITY—Mark Twain once commented that reports of his death are premature and the same can be said of shopping malls in the US. The mall, which is an American post World War Two phenomenon, has been moribund in this millennium with construction falling from 25 million gross square feet in 2001 to less than four million gross square feet annually for the last few years.  This reduction is less a sign of the demise of malls, than a transition and part of a metamorphosis into what could be called the Mall Plus.

Certainly, changing demographics, the rebirth of many of our urban areas after years of blight, the birth and growth of televised shopping shows, internet shopping, and the age and deterioration of many malls as well as the concern about crime and terrorism, and, of course, major recessions in 2002-2003 and again 2008-2011 have affected American’s shopping habits. However, that only means the industry has to change to survive. We are early in the transition to Malls Plus, but there are actual signs of a recovery. It is true that only eight new malls have been built in the United States since 2008, but that ignores the virtual collapse of the financial markets in 2008 and the five to ten years it takes to plan, obtain land and permits, build a mall and finally the need to line up tenants to occupy the retail spaces.