Local Businesses Are Sucking The Life Out Of Our Shopping Malls
A few decades ago, everyone was worried about the “Malling of America.” Downtowns were turning into ghost towns because everybody was shopping at the mall. And the country became so homogenized and standardized, every place started looking the same. A suburb of Chicago or Seattle, a small town in Kentucky or Utah — everywhere you look, you see the same shops and fast food places.
And now, with chain stores dropping like flies, the mall could be on its way out. Some of these casualties include “anchor” stores — well-known department stores that draw shoppers into the mall.
The chairman of a national retail consulting and investment banking firm said: “It's an absolute disaster. What a mall represents is discretionary spending, and discretionary spending is in a depression…Without the anchors, there is no mall.”
Last summer’s gasoline prices got this trend started. It got so expensive just to drive to the mall, people started shopping at those boring local mom-and-pop stores that they used to ignore.
The economic meltdown is bad news not only for the chain stores, but also for the developers and owners of shopping malls. When an anchor store goes vacant, the entire mall is threatened. You’re not gonna believe this (it was news to me anyway), but anchor retailers are actually PAID by the mall owner to be tenants at his mall. Nice work if you can get it. (Well, it used to be.)
A real estate advisor said: “If the big guy closes up, then none of the little guys are going to get the business. There will be precipitous closings of stores within the lower-tiered malls.” Share prices of the country’s second largest mall operator — General Growth Properties — have fallen below a dollar.
As terrible as this depression is, there might be a few silver linings. When we recover, maybe — just maybe — our values and priorities will be a little more grounded. Urban sprawl, people buying stuff they can’t afford and don’t need so they can impress people they don’t care about — R.I.P.
Now that the house of cards has collapsed, let’s replace it with something more solid.
cross-posted at Bring It On!