IRVINE, CA—For the past decade the question about regional mallsfalling to the wayside has been a great concern for owners andretailers. That is according to locally based DonMacLellan, senior managing partner, Faris LeeInvestments. MacLellan, who spoke with us for an upcomingNovember Real Estate Forum feature, says that “theregional mall concept will continue to thrive dependent upon anumber of factors including the demographic make-up, the populationdensity, trade area competition and the strength and performance ofthe specific mall anchors.”

According to MacLellan, the advent of big box, discount-orientedcommunity centers has taken a significant market share from theolder, middle-market department store anchors such as Sears,JCPenney, etc. “The strongest performing regional malls are eitherin more affluent trade areas with higher disposable incomes or arethe dominant malls in the secondary market locations,” hesays. “Many traditional non-performing regional malls have beenforced to reinvent themselves. They have transitioned into bigbox shopping centers (discount focus) or outdoor lifestyle centersthat really focus on specialty retail, entertainment – like movetheatres with a myriad of restaurant-oriented concepts.”

Population density plays a big part when it comes to malls insecondary locations, he says. “What we have seen in these secondarytrade areas is that there is only demand for one regional mall,leaving the others forced to morph into alternative uses.”