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Us - The Economics (And Nostalgia) Of Dead Malls

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http://www.nytimes.com/2015/01/04/business/the-economics-and-nostalgia-of-dead-malls.html?ref=business&_r=0#

OWINGS MILLS, Md. — Inside the gleaming mall here on the Sunday before Christmas, just one thing was missing: shoppers.

The upbeat music of “Jingle Bell Rock” bounced off the tiles, and the smell of teriyaki chicken drifted from the food court, but only a handful of stores were open at the sprawling enclosed shopping center. A few visitors walked down the long hallways and peered through locked metal gates into vacant spaces once home to retailers like H&M, Wet Seal and Kay Jewelers.

“It’s depressing,” Jill Kalata, 46, said as she tried on a few of the last sneakers for sale at the Athlete’s Foot, scheduled to close in a few weeks. “This place used to be packed. And Christmas, the lines were out the door. Now I’m surprised anything is still open.”

The Owings Mills Mall is poised to join a growing number of what real estate professionals, architects, urban planners and Internet enthusiasts term “dead malls.” Since 2010, more than two dozen enclosed shopping malls have been closed, and an additional 60 are on the brink, according to Green Street Advisors, which tracks the mall industry.

Premature obituaries for the shopping mall have been appearing since the late 1990s, but the reality today is more nuanced, reflecting broader trends remaking the American economy. With income inequality continuing to widen, high-end malls are thriving, even as stolid retail chains like Sears, Kmart and J. C. Penney falter, taking the middle- and working-class malls they anchored with them.

“It is very much a haves and have-nots situation,” said D. J. Busch, a senior analyst at Green Street. Affluent Americans “will keep going to Short Hills Mall in New Jersey or other properties aimed at the top 5 or 10 percent of consumers. But there’s been very little income growth in the belly of the economy.”

..

Shopping Dinosaurs

Almost one-fifth of the nation’s enclosed malls have vacancy rates considered troubling by real estate experts — 10 percent or greater. Over 3 percent of malls are considered to be dying — with 40 percent vacancies or higher. That is up from less than 1 percent in 2006.

Once more the rich appear to be doing OK, if people can't even get a job in mall how are they going to afford to shop? Still viva recovery!

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Malls grow and die, and only 3% failing doesn't seem that bad to me. Around here, for example, one of the malls used to be built around a Walmart, but then Walmart moved to a new mall on the edge of the city. Some other stores followed Walmart to the new mall, some closed down, some new ones moved in, but it's still much less busy than it used to be.

Edited by MarkG

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