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Dead malls are a virus: getting creative with repurposing

Dead malls are what happens when an anchor store leaves and everyone follows, leaving a ghost town where a vibrant shopping center used to be.

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What’s a dead mall and why should you care?

dead mall seriesAs new malls open in cities, the shine wears off of the older malls, patron shuffle over to the shiny and the older may end up closing as lease holders jump ship to newer areas. In other words, it dies. This typically happens in areas of town that are declining or that were overbuilt with retail space.

When a mall begins dying, it’s like a virus. But it doesn’t always happen in declining areas, some of the pictures below are of the Gateway Center in Austin which is in an upscale area but happens to have been hit by some big box bankruptcies. The end of the center is vacant and has been for some time, but the virus is in the decline of the buildings as lease holders are not keeping the buildings up anymore and strip mall or traditional mall owners are too strapped for cash (because of the rising vacancy rates) to do basic upkeep (regardless of what CAM other leases are paying).

This all matters because residential agents make recommendations to home buyers and sellers based on all surroundings, including dead malls.

What can we do?

As an industry, we need to get creative. Not just on a single mall basis, but overall by pushing for legislation that allows grants for repurposing of dead spaces before they fall into such disrepair that they’ll be required to be bulldozed rather then repurposed (which isn’t exactly the most environmentally friendly move as it wastes a perfectly good shell building).

What could a dead mall become? Here in Austin, a mall that is no longer the city’s diamond mall (aka no one goes there anymore) may be redone to be a community college campus rather than demolished. Dead malls can become office buildings in areas where that is beneficial, or can become community center or indoor amusement centers. Right now, the commercial sector has no incentive to repurpose, it’s actually cheaper, faster and higher return to simply demolish, but to be honest, dead malls are frowned upon and typically continue falling into disarray.

What are some ways that our industry could help to repurpose dead malls? What are YOUR ideas?

Take a tour of some dead malls:

dead mall series


dead mall series


dead malls series


dead malls series


dead malls series


dead malls series


dead malls series


dead malls series


dead malls series


dead malls series

Lani is the Chief Operating Officer at The American Genius - she has co-authored a book, co-founded BASHH and Austin Digital Jobs, and is a seasoned business writer and editorialist with a penchant for the irreverent.

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28 Comments

28 Comments

  1. Benn Rosales

    March 27, 2010 at 11:07 pm

    This is really a failure on management and ownership to adapt and become flexible. Even in today’s tough market, PMs and developers are still proud of their empty office space/retail space and market pricing remains at levels from 2003 – utterly ridiculous. If the area is declining, I’m not sure retail becomes the answer, but as in the case of highland mall here in Austin, it made sense for ACC (Austin Community College) to snatch up the prime real estate. The land will continue to accrue in value because of its prime location in the center of Austin, and the school will flourish- incredibly creative.

    Some of the old malls should be demolished, but it seems that more attractive concepts could take their place- the real estate works.

    I grow more and more concerned with the outdoor mall concept, the old town center style shopping that is dependent on good weather for activity, a lack of close proximity parking limits the in and out of consumers. I’m sure some focus group somewhere said this was a good idea to for live/work highend, but somehow I doubt longterm living will every take place in a mall.

    • Lani Rosales

      March 28, 2010 at 6:51 pm

      “I doubt long term living will ever take place in a mall”

      >I totally agree UNLESS it is in a college campus scenario. Living above retail would be a homerun in that scenario.

  2. Carson

    March 28, 2010 at 1:33 am

    It is really sad that the design of these spaces doesn’t work for small business. Maybe they can be converted into mini indoor malls with single entrances. Sounds like a flea market. I think that office space makes the most sense. And office mall. And, you can landscape a lot of that extra parking space. If it doesn’t work for retail quit treating it like retail. I was also thinking warehouse/distribution. That or indoor paintball. Lazertag?

    • Lani Rosales

      March 28, 2010 at 6:52 pm

      I love your ideas, Carson, especially about making some of the parking green space, or why not park areas? Industrial would be a great replacement and come to think of it, an old bank in Austin was transformed into a Lazertag arena which it has successfully been for over a decade now. Great input!

  3. Erica Ramus

    March 28, 2010 at 10:21 am

    About 5 years ago a local mall asked me to help them fill space. I created a whole presentation on trying to attract “nontrad” tenants and perhaps discounting space to get large volume tenants in that would bring “feet” to the mall, which would increase traffic, which would help current tenants pay their rent, which would … big circle.

    I had ideas to fill the mall with a local library that needed space, a daycare center, a fitness center, a doctor’s office, back end offices. I brought the ideas and some tenants who were interested and one by one the mall management dropped the ball and dragged their feet. THey really wanted REATAIL and didn’t want to go that route so they just ignored nontrad tenants. Now, that mall is a ghost town. Nobody goes there anymore unless it’s a destination to one shop. In and out.

    Another local mall did the opposite. It hired a new local broker to beat the bushes, to work WITH them not against them. I helped bring a local community college in to their mall, and they were successful in filling other spaces with some retail, some nontrad, including a surgery center! Think about it: plenty of parking, easy to get to, etc. Why not?

    If mall management does NOT change their thinking and repurpose many malls will become ghost towns.

    • Lani Rosales

      March 28, 2010 at 6:55 pm

      Erica, you hit on an important note above- the medical sector is and has been growing, big boxes that die are PERFECT to be repurposed for that, why not? Also you noted that management digs in their heels… it is VERY rare for management companies to think creatively, there is typically a list of acceptable tenants (and that list looks like their existing tenant roster). It’s a shame, really.

      • Erica Ramus

        March 30, 2010 at 9:06 am

        That’s exactly what happened. They wanted me to find similar retail tenants and restaurants to add to the mix, not create a new niche.

        I also don’t see the outdoor mall/lifestyle center thriving here in the Northeast, with our 5-6 months of cold weather.

        One successful trend has been taking malls with 4 entrances only, and busting through the exterior to open them up to outside traffic, so people can run in and out quickly (video store… etc) and not walk the whole mall to get to 1 shop in the middle.

  4. Jason Sandquist

    March 28, 2010 at 12:26 pm

    We have a few here around Minneapolis – St. Paul. One is newly built mall that is already REO, it is an outdoor mall and whoever gave the green light on that one is probably in the unemployment line being that the Twin Cities just doesn’t have the year round weather to support it.

    Another is a mall that has been on the auction block a few times that has just struggled for the past 15 plus years to keep major tenants, blighted area et al. The only reason why I bring this one up is because I just saw an article on it today stating that Wal-Mart wants to try and move in again. They tried that a few years ago and a bunch of the anchor tenants sued them not to move in. Wonder what they are thinking now…

    • Lani Rosales

      March 28, 2010 at 7:00 pm

      Outdoor in your area? I get how it works here, but there? That’s silly.

      Wal-Mart tried to do the same here (but got a big fat no by activists) and they have new prototypes that are greener and smaller and they are trying to repurpose some spaces (although I haven’t heard of it happening anywhere yet). Wal-Mart isn’t ideal, but it’s better than a dead mall virus.

      • Benn Rosales

        March 28, 2010 at 7:07 pm

        This is exactly what’s happening at north cross, they repurposed some percentage of the original mall, leveled the rest, and now will stand a chic looking urban walmart about the footprint of a small jcpenny or sears freestanding. Cool thing with those smaller freestanding units, they’re a little more square and harder to recognize when they close down leaving a somewhat desirable spot for other ventures unlike recognizable structures like target and large walmarts.

  5. Missy

    March 28, 2010 at 11:17 pm

    We had a not quite dead mall in Ann Arbor a few years ago. Shabby…ugly etc. Finally a new developer bought it and completely remodeled it. Stuck a Toys R Us in there, Starbucks, Marshall and smaller boutique shops and it is now doing well.
    Great location between U of M and EMU.

    I go over there, for Marshall’s and Michaels and to take the dogs (all 4 of them) to get haircuts.

    • Lani Rosales

      March 29, 2010 at 12:31 am

      Missy, I’m curious how residential and commercial performed in that area around the mall before it was revived, any impact?

  6. Jason Sandquist

    March 29, 2010 at 1:06 am

    maybe they should all be turned into skate parks 🙂

  7. Missy

    April 2, 2010 at 9:46 am

    Their was no issue in housing or commercial. It has it’s own flavor on the East side. Always crowded and unique businesses are right there.

  8. Bobbie Fenton

    February 10, 2012 at 9:36 am

    Why has no one thought to turn these into indoor cities???? Residential/retail space where some small businesses like coffee shops and pharmacies, spas, theaters and exercise clubs could live hand in hand with upscale condos! This would be fabulous!! I can think of some absolutely really cool things that could be done to turn one of these things into a residential/commercial space that would be fantastic!!!

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Austin

Austin tops the list of best places to buy a home

When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?

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Looking at the bigger picture

(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).

That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).

They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.

“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”

Click here to continue reading the list of the 12 best places to buy a home…

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Housing News

Average age of houses on the rise, so is it now better or worse to buy new?

With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.

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aging housing inventory

The average home age is higher than ever

(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.

With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.

Prices of new homes on the rise

Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.

Click here to continue reading this story…

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Housing News

Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?

The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.

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zillow move

Why Realtors are vulnerable to these rapid changes

(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.

Note: We’ll let you decide which company plays which role in the image above.

So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.

1. Zillow poaches top talent, Move/NAR sues

It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.

Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.

2. Two major media brands emerge

Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.

…Click here to continue reading this story…

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