Transwestern Regional Mall Reuse Report

Transwestern has the report, “Why Mall Reuse Is Just Beginning,” explaining that while the retail sector certainly faces challenges, the idea that all regional malls are obsolete is simply not accurate.
“The assumptions that all purchases are moving online, all retailers are going bankrupt, and all millennials reject the suburban mall and the lifestyle it represents are grossly exaggerated,” said Brian Landes, Director, Location Intelligence for Transwestern. “Furthermore, we’ve seen that when malls are reconsidered and repurposed for other uses, their value may exceed their use as conventional retail space.”
Regional malls have had positive net absorption since 2010, with the only blip in absorption occurring in 2009, at the height of the recession. In 2016, the U.S. retail market experienced 105 million sq. ft. of net absorption, representing a growth in occupancy of nearly 1%. At the end of 2016, mall occupancy across the U.S. was above 95%, equating to 848 million sq. ft. of space. Mall productivity rose 0.7% in the last year to $465 per square foot.
“While we’ve seen store closures increase in 2017, for the most part, malls are attracting new tenants through strategic marketing and property enhancements,” said Nick Hernandez, Managing Director of Retail for Transwestern.