As Offline Retail Dies, Commercial Real Estate Apocalypse Looms

As we do more and more of our shopping while sitting on our couches in our pajamas with an Ultrabook, we’re destroying a glorious American institution: the mall. Realspace retailers large and small alike have gone bankrupt and shut down or scaled back: a process that the recession only sped up. The best case scenario? Those former malls might become community colleges or gain some condos. What’s more likely? Rotting husks of shopping centers dotting our cityscapes, dragging down property values and making everyone sad.

There’s a mall near you right now that’s a virtual ghost town. (Don’t believe me? Click on your state on Deadmalls.com. One dead mall in my city even has its own satirical Facebook page.) One analysis by commercial real estate firm Co-Star shows that 200 malls in the United states have more than a third of their space vacant. Another estate executive told journalists this past June that he expects at least ten percent of large malls to fail and shut down in the coming decade. Will they become mixed-use developments that will revitalize surrounding areas and repurpose those hulking empty Bon-Ton and Borders stores? Probably not. Developments filled with shops and condos need a population with high per capita income and high population density. If a community has both of those things, its malls probably aren’t failing in the first place.

The Death of the American Shopping Mall [Atlantic Cities] (Thanks, Dan!)
Retail REIT Executive: Most Failed Malls Will Languish [WSJ]