Video: Mega Malls and High-End Malls Are Doing Just Fine, Thank You

Solar powered Shake Shack opens in King of Prussia.

An outpost of the New York-based trendy burger chain Shake Shack opened at the King of Prussia Mall last year — with a solar panel-covered roof.

Since 2007, 400 malls in the U.S. have closed. Now comes the filing of bankruptcy protection from both Quiznos and Sbarro, and that’s after the partial demise of mall anchor tenants like JC Penney and Sears. From Yahoo Finance:

A decade ago there were more than 1,100 enclosed shopping malls in the U.S. Since then more than 400 have either been “re-purposed” or closed outright. No new malls have been completed since at least 2009.




Onetime mall devotees like Shoppist editor Emily Goulet are now mall escapees. Of the Oxford Valley Mall, she writes:

It's dirty. It's depressing. ...The quality of stores has gone down, way down... The stores that remain need a facelift, too. Dressing rooms are in desperate need of a paint job, racks are horrifically disorganized, and everyone just looks like they want to go home. Even the clothes, which sag limply from hangers and hang off the arms of chipped mannequins that look like they're from about 1987.

That's why when she goes now, for one item the mall carries, "I can be in and out in less than six minutes."

I know this because sometimes I make my husband idle in the car in front of the entrance so that it's more of a drive-by shop than an actual trip. We time it, and when I jump in the car I feel as if there must be zombies chasing me out the door.

From a real estate perspective, shoppers like Goulet -- who used to spend hours in a mall -- are a problem. But they also represent an opportunity.

In her piece "Can Wild Boar Save the Suburban Mall?," Philadelphia Magazine's Vicki Glembocki points to the latest outpost of Marc Vetri's Osteria -- in South Jersey's Moorestown Mall. Though the Vetri placement seems bizarre, it plays into a reality of mall economics right now: High-end malls are doing well. Very well.

Joseph Coradino, CEO of PREIT, which owns the Moorestown Mall (along with 35 others), knows his business, so while the traditional malls and the smaller malls are in decline, the industry as a whole is not. It's simply changing. As Glembocki points out, PREIT has rolled with the times:

PREIT got creative. Echelon became the “Voorhees Town Center,” with the township occupying the mall’s very vacant second floor and high-end apartments moving in next door. In Plymouth Meeting, PREIT wooed Whole Foods, P.F. Chang’s, and a surefire foot-traffic ge­nerator—a 23,500-square-foot outpatient facility run by Mercy Health. That plan worked so well, Exton Square just added the Main Line Health Center. Cherry Hill put on some fancy big-girl pants—Nordstrom, Henri Bendel, Crate and Barrel, Armani Exchange, Season 52, Capital Grille—and in the third quarter last year, an impressive $629 per square foot in sales followed. (A healthy mall does above $400. KOP historically pulls in an average of $700.)

Another part of Coradino's strategy: bringing visitors to the malls for experiences they can't have online.

In this case, that experience is savoring Osteria’s polenta budino, or seeing Garces’s wall decorated with luchadore masks, or getting a $145 haircut and blowout. (“You can’t get a haircut online,” Coradino notes.) And then, after your glycolic peel at Rizzieri, and after you grab an order of huarache de costillas for lunch at Distrito, and after you browse boutique row (because that’s coming next, right across from the spa—a strip of high-end local shops), then … hopefully … by the grace of God … you’ll wander out of the cool-kids wing and pick up some sneaks at Lady Foot Locker.

Why I Hate the Oxford Valley Mall [Shoppist]

Can Wild Boar Save the Suburban Mall? [Philadelphia Magazine]

Not dead yet: The American shopping mall is changing, not going away [Yahoo Finance]

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  • DTurner

    It’s pretty clear that the market is just adjusting to over-saturation, we have too many malls in the region and while KOP and Cherry Hill Mall will continue to be successful, other malls are going to die off or will need to adjust their model. The biggest question is whether it will be worth the money of owners like PREIT to do so.

    Sure, Echelon Mall is now Voorhees Town Center and the new areas developed around the mall are successful, the mall itself, to my knowledge has continued to be unpopular. Will PREIT be willing to dramatically renovate or even tear down the mall to redevelop the site? The redevelopment of the mall and “neighborhood” around White Flint Mall in Montgomery County, MD might be a good model, especially with Voorhees Town Center’s close proximity to PATCO-
    http://greatergreaterwashington.org/tag/White+Flint/

  • matthew brandley

    PRIET is a ponzi scam and reggie middleton has pointed this out over and over again. they are so leveraged with debt its a joke. As far as malls? the retail collapse thats ongoing will take many down with it. The economic tsunami thats about to hit the markets and every rich person in this country thanks to the unwinding of carry trades n china, the selling of metals as collateral to cover those trades and the collpase of housing in thisountry and China is going to end in tears for millions of people. G M is going to declare bankruptcy again by the end of the yeaqr along with many mega retailers. many of you on here have no idea how bad everything realy is just as long as you keep believing everything the inky prints and what Obama says . fools