The US retail apocalypse

 

My wife and I went to a department store closing within the last week, reminding me of a subject I've been concerned about for awhile.  The earlier mall form of retail shopping is dying in America.  It's just supply and demand playing out, right, just as small mom and pop stores gave way to supermarkets, and Walmart disrupted those (and malls), along with other big box stores shuttering local hardware and electronics stores and the like?  Sure, but for many nostalgia plays a role in seeing it differently, seeing a part of their earlier life experience come to an end.  

a dying mall in Bangkok, MBK, but the return of tourism may save it

That was the third department store in a local (Bangok) mall that closed, that I know of, so the process runs well behind entire malls going empty and later being demolished in the US.  But it seems to be coming.  Online shopping runs behind Amazon and Ebay development here, but for sure every year Shoppee and Lazada do more business here, and packages arriving in homes replaces trips out to physical stores.

I'll refer to a lot of what is routinely covered in a favorite Youtube channel about this trend, Ace's Adventures.  I just won't scan through hundreds of hours of videos to find individual statements to support the generalized overview here.  Per my understanding that video content producer, Anthony, didn't start that channel form, and he did credit one main person who did.  In scanning a Wikipedia "dead mall" topic page it seems that maybe it was Dan Bell who developed that, in this series.

To be clear what I'm going to summarize here is really my own take on ideas I've been exposed to, and may not faithfully represent the facts of the matter, or interpretation by any "dead mall" enthusiasts.  I've seen videos by others, but this is only one of many themes I've checked out and let go, so I'm far from an expert on it, or even a well-informed follower of this topic.  I've watched a couple of dozen related videos; that's it.

in my hometown, Cranberry, PA

Why are malls dying?

No single set of reasons, but speculation tends to settle on a few.  Online shopping has been having an impact.  In some cases too many malls were built, some quite close to others, and older versions tend to lose popularity in that situation, and later become vacant.  Wal-Mart had an impact, but Wal-Mart has been impacted by online shopping, bulk shopping options (Costco, with Sam's Club their own version), and other "big box" retailer popularity too.  In some cases disruptive behavior of some mall regulars, crime or harassment, made some malls feel less inviting.  Smaller "lifestyle centers," updated versions of earlier strip mall themes, replaced some demand, by updating restaurant version options and including more up to date activity related businesses, eg. yoga or tae kwan do studios.

fantastic aesthetics!  photo credit to Ace's Adventures Facebook page.

Is dated style a main concern, or poorly maintained mall conditions?

Maybe not as much as one might expect.  Some interiors definitely do have a distinctive 80s or 90s look and feel, which could relate, but many of the videos cover malls that were renovated to return to pristine and somewhat updated appearance conditions (which can only be changed so much), and the business still never returned.  The local mall in my home area, in Cranberry, PA (with a video showing that here), did reportedly have problems with roofs leaking, which certainly wouldn't help, and could be one more reason for major tenants to move out, but it seems like it was economics driving the process, reduced demand.  Covid pushed many malls over the edge, for obvious reasons, but for most the process was already quite progressed by 2019.

malls were literally closed here during 2020, except for grocery stores

Why do people create these videos, what is the interest about?

The appeal that gets cited is an interest in preserving a video record of what these 70s, 80s, and 90s malls were like, before many are demolished.  Some are actually closed during the filming, but more often they're just essentially vacant, with only a few minor stores left.   Nostalgia seems to drive that, personal interest in that earlier cultural form.  Many really do have a novel look, and those that peg earlier standard design themes have a different kind of appeal, for capturing a moment in time, in terms of public shopping space design.  

What I like most about Anthony's (Ace's Adventures) tone and style relates to a true appreciation for these places, not a morbid curiosity about decline itself, but an appreciation for the style and earlier experiences that are no longer available in the same form.

Is there a typical progression in malls dying?

Sure.  Main anchor tenants go first, places like Sears and JC Penney, which first closed as individual locations, and later closed many of their stores nationwide.  These tend to be replaced by other major tenants, with something like a sporting goods store often moving into that larger space.  But there is a process in place that's hard to disrupt at that point, with decreasing foot traffic leading to other store closures, which leads to less mall visitation, and so on.  Gaps in mall maintenance can come up, but again that often doesn't seem to be a critical step in the progression.  Higher cost, volume intensive facilities like ice skating rinks tend to close earlier on, as it becomes impossible to offset high operating costs.  Businesses like a cinema might close later on, or parts of a food court might remain open, with limited customer volume funneling down to a smaller set of food outlets as some close.

This last point ties back to dated style being a concern, and newer small lifestyle centers replacing mall based options.  Older food outlets, like Auntie Anne's pretzels, or Orange Julius booths, can still be appealing related to the nostalgia factor of people remembering enjoying that, but over time food preferences tend to shift.  Since we tend to run a little behind in what exists and is in demand where I've been living in Thailand--a subject I'll get back to--Auntie Anne's pretzels are doing just fine here, as Dairy Queen booths are, and Mr. Donut stores.  Time catches up with that last chain though; it's now being replaced by Krispy Kreme and Tim Horton's stores.

In the end it's a struggle to keep to keep any businesses open.  For whatever reason American Eagle Outfitter type clothing stores and Bath and Body works stores seem to hang in there longest.  Then malls tend to try to convert to using space for offices and such, most often unsuccessfully.

Is this happening elsewhere, for example in Hawaii or Thailand?

Yes and no.  The main malls in Oahu seem to be doing ok, for now, but with many having a dated look and some locals switching over to online shopping it may only be a matter of time.  A Sears just closed there in one main mall, which is how that starts.  The main mall in the Waikiki (tourist resort) area is the Ala Moana Center, the largest open air mall in the world (I think it was), and that seems quite healthy (as of a number of visits in October), even with the somewhat reduced tourism level from covid impact tapering off over time.

Ala Moana; a little dated in design, but it's nice

Christmas in October in a Thai mall, that is doing ok

a large Japanese store went out of Central World, a thriving Bangkok mall

There was a progression of overbuilding local malls in some areas in the mainland of the US that is probably also happening in Thailand, with the main build-out of malls in the Bangkok area only relatively complete in the last 5 years or so.  In other smaller cities new malls are being developed in close proximity to older versions, which could lead to the same cycle occurring there.  Older types of shopping centers close from time to time in Bangkok, but in general those places tend to experience long, slow deaths instead, drawing on limited local shopping support to hang in there.

one predecessor to malls in Thailand, roofed shops areas

the Nightingale Department store, the first in Bangkok, which may or may not still be there

Can standard format malls still thrive in the US?

Of course.  These tend to be newer facilities, with a less dated look and feel, but really local shopping support depends on a number of factors, including what other options are around.  It's not as if everyone in the US decided that walking around a mall is a bad idea at the same time; again instead a number of factors seemed to lead towards that end point.

the Pearl Ridge mall near Pearl Harbor; a bit dated, but it's doing ok

Are there ways for struggling or healthy malls to avoid this pattern?

This part is less clear, something I've been considering quite a bit myself.  If "lifestyle centers" can help cause mall decline it should be possible for malls to utilize the same type of specialty store option availability to preserve their own traffic, even if visitors really don't want to experience the process of parking in a large lot and walking a moderate distance to visit a store.  I would guess that updating restaurant options and adding newer form shops and services might help, places like yoga studios, or moving off the theme of including dated food shop chains onto unique restaurant options instead.

All that is easier said than done.  The overhead malls had to contend with isn't reduced just because visitor demand drops; maintenance costs would actually rise over time.  If a mall valued at $200 million is sold for $50 presumably shop rents could be cut as well, but if a mall is working with less and less visitor traffic cutting store rents is only going to go so far to offset the decline, and there would be a natural trend to try to retain revenue by charging full prior rent rates to all existing businesses, even though many would already be in the process of failing. 

It seems conceivable that a mall could get ahead of this curve and move to switching over to some office use space before the stores are mostly gone, preserving the life of some by adding that related foot traffic.  There is no mention of any such successes in any of the dead mall videos I've seen.

Kahala Mall at the edge of Honolulu; dated in style but still appreciated

a spectacular vertical theme mall in Hong Kong, bustling in 2019

a St. Petersburg (Russia) mall, decorated for Christmas