Competition for Customers Changing Malls

Written by Posted On Wednesday, 05 July 2006 17:00

The next town over from mine, Cherry Hill, N.J., has nothing that resembles a downtown.

A sleepy farming community until the post-World War II suburban boom, what was then called Delaware Township became the home of the East Coast's first enclosed shopping mall in 1961.

While still a major draw for thousands of shoppers from South Jersey and Philadelphia, which is across the Delaware River, the mall has remained just that -- a suburban mall, surrounded by strip malls, surrounded by thousands of single-family houses and apartments.

About 70,000 people live in Cherry Hill -- renamed, according to the township's website, for the mall. At long last, however, the township is actually getting a center -- mixed-use on the site of former racetrack -- at an estimated cost of $500 million.

It is highly unlikely that the town center will replace the Cherry Hill Mall in its importance to both the township and the region.

In other areas of the country, however, competition for retail dollars is forcing the redevelopment of many obsolete malls into town centers with housing, hotels, civic and cultural facilities, public gathering places, and pedestrian-friendly streets.

The Urban Land Institute has published a booklet, Ten Principles for Rethinking the Mall, which outlines the institute's thinking about how redevelopment can best be carried out.

Redevelopment of malls must be tailored to fit community needs, the mall site, as well as market demands, the booklet suggests.

Each site is unique and revitalization will require an understanding of the current and future competitive position in the local market, as well as an analysis of financially realistic redevelopment opportunities, according to the booklet.

Several examples include: tearing down the old mall and building something completely different; rebuilding a newer mall; reconfiguring, expanding, or downsizing the old mall; turning the mall inside out to create an outdoor experience; creating a hybrid indoor-outdoor center; adding other uses as part of the mix; creating a lifestyle, power, or off-price complex; or a town center.

"A number of factors may further complicate the decision about what to do, such as the necessity of keeping the mall open during redevelopment," said Michael Bayard, a senior resident fellow at ULI.

These include "the cost of keeping tenants in business while reconstruction goes on around them; and the need to accommodate public uses, linkages, amenities, and connections to the surrounding neighborhoods that didn't previously exist."

Three malls in the Washington, D.C. region -- Landmark Mall in Alexandria, Va.; Wheaton Plaza in Wheaton, Md., and the Landover (Md.) Mall -- were examined by a team of ULI experts from around the country to assess sites that were struggling to stay competitive and to provide ways to revitalize them.

Their research came up with the 10 principles:

  • Grab your opportunities or they will pass you by. Opportunities abound in both a declining and improving asset. As the value of a mall decreases, the opportunities for large-scale change increase.

  • Broaden your field of vision. Think big, look beyond the borders of the property and beyond retail to envision what can and should be undertaken.

  • Unlock the value of the land. An old mall should not be viewed as a problem but as an opportunity to restore vitality to the site.

  • Let the market be your guide. Shifting demographics and evolving consumer tastes are transforming the retail markets of the 21st century.

  • Create consensus. Start with realistic goals that match the needs of the community and get support from a leader to champion the project.

  • Think holistically before planning the parts. Stay flexible and think long-term, keep the big picture in mind, including financing options, partnerships in the community, and future opportunities.

  • Connect all the dots. Transforming a mall into a "place" can be achieved through connectivity, including road layouts; shuttle bus service; strategically located parking areas and sidewalk connections, and signage.

  • Design parking as more than a ratio. Plan and design parking to play a supporting role rather than a dominant one.

  • Deliver a sense of community. Plan for people first, create an identity, create a destination, and give people reasons to come back often.

  • Stay alert, because the job is never done. To be successful, the mall needs to keep pace with change.

    "A declining mall should be seen as an opportunity to better address community needs, and provide a plan for growth in partnership with the surrounding community that strengthens the economic vitality and enhances residential neighborhoods," Beyard said.

  • Rate this item
    (0 votes)

    Realty Times

    From buying and selling advice for consumers to money-making tips for Agents, our content, updated daily, has made Realty Times® a must-read, and see, for anyone involved in Real Estate.