Friday, Aug. 29, 2008

Death of the shopping mall

Shoppers abandon indoor malls for outdoor retail centers

Metcalf South Mall is a ghost town.

Many stores long forgotten still bear the names of former tenants permanently affixed above their gated entrances, which block the few who still come to the mall from entering the vacant stores.

The off-white-and-salmon-colored tile floor reflects the white lights from above.

Some of the indoor fountains still run. Music popular during the era when the mall was still vibrant emanates from ceiling speakers. Air conditioning flows through vents.

Except for the outdated decor, which likely hasn’t changed since the mall was built in 1967, and the empty stores, the mall looks like it should still function.

But the only people who still use the mall between its remaining anchors Sears and Macy’s — with the exception of the few who work in offices that have located there — are the walkers.

“We don’t understand it, but we like it,” Dick Saplata said Thursday of the empty mall, which remains open from 10 a.m. to 9 p.m. Monday through Saturday and noon to 5:30 p.m. Sunday. “We appreciate it.”

The Leawood resident has walked laps in the mall’s vast corridors with his wife, Anne, anytime it’s cold, hot or rainy for the last three years.

“It’s a nice place to go,” Saplata said.

Metcalf South, for lack of a better term, is dead. Many enclosed shopping malls in the Kansas City metro area have suffered or are suffering the same fate.

In Kansas City, Mo., renovations are planned or are under way for Indian Springs, Bannister, Mission Center and Antioch Center malls. Blue Ridge was redeveloped into a Wal-Mart Supercenter and opened last year.

Some malls are on life support. Metro North Mall in North Kansas City, Mo., is about one-third occupied with 100 of its 140 stores vacant.

Olathe’s Great Mall of the Great Plains has about 40 vacancies and is two-thirds occupied.

Oak Park Mall in Overland Park and Independence Center remain the metro’s only actively successful enclosed shopping malls, but a trend in the industry has created new shopping options for consumers.

Open-air malls, or lifestyle centers as some call them, have sprouted up in the metro.

One could argue that one of the first lifestyle centers in the United States was the Country Club Plaza, which opened in 1924 in Kansas City, Mo.

But some say the trend in Kansas City took off after the development of Town Center Plaza in 1996 in Leawood. Since then, other lifestyle centers have opened, including the 1.2 million-square-foot Legends at Village West in Kansas City, Kan., and Zona Rosa in North Kansas City, Mo., which will be built to 1 million square feet.

“Basically, it’s just an evolution in the industry,” said Erin Hershkowitz, spokeswoman for mall trade organization International Council of Shopping Centers (ICSC).

Rise and decline Enclosed shopping malls began opening in Kansas City in the 1950s starting with Mission Center and Antioch Center in 1956. Blue Ridge followed in 1958, Metcalf South in 1967, Indian Springs in 1971, Independence Center in 1974, Oak Park in 1975, Metro North in 1976 and Bannister Mall in 1980. The metro’s last enclosed mall, the Great Mall, opened in 1997.

With the exception of Oak Park and Indian Springs, which have undergone major renovations over the years, many malls began losing tenants.

At Metro North, General Manager Mike Chase said the exodus was partly because some retailers wanted to own their own buildings. Others went bankrupt, or their contracts weren’t renewed, he said.

Andrew Nave, recruitment and retention manger for the Overland Park Chamber of Commerce, said demographics in the city shifted to the south, where several neighborhood strip centers popped up in Overland Park, Lenexa, Shawnee and Olathe.

Consumers’ shopping patterns and habits changed over time, dictating a response from developers who are now meeting those demands by constructing new lifestyle centers, said Jeff Kaczmarek, president and chief executive officer of the Economic Development Corporation of Kansas City, Mo., (EDCKC).

“Retailing is a very volatile business,” he said. “Style changes, shopping patterns, those things change more rapidly than any other kind of land use.”

Tim McKee, the Olathe Chamber of Commerce’s vice president of economic development, has heard the same thing from developers.

“That indoor concept is kind of not a concept that’s being used now,” he said. “Unfortunately, (the Great Mall) might have been one of the last enclosed malls built in this region, maybe even the Midwest.”

But Greg Walker of Metcalf South owner MD Management, a Mission company that also owns malls in other states, said the interest in enclosed malls from consumers has waned all across the country.

“Generally, there’s been a change in people’s mindset, how they shop nationwide,” he said. “Mall shopping has declined.”

Shifting trends According to data from ICSC, 25 shopping centers of at least 700,000 square feet have begun constructed since 2006. Only one of those was enclosed.

There are several reasons, Hershkowitz said. She said outdoor centers are more convenient for consumers, allowing them to park in front of stores. But their biggest selling point, Hershkowitz said, was the atmosphere created by their design, which typically features benches, fountains and landscaping. Many have restaurants and entertainment features, she said.

“Those types of things are really created to draw the consumer in for reasons other than to just purchase items, she said. “It’s changing the face of shopping where it used to be get in, get what you need... Now it’s more common to stay; there’s other reasons to go besides do your shopping.”

EDCKC’s Kaczmarek said lifestyle centers create a downtown feel with the growing popularity of high-end retail and upscale dining common in large metro areas. He said they combine shopping and entertainment.

“That’s what downtown brings,” he said. “It’s a much broader mix of uses. The malls just can’t duplicate that, the old enclosed malls. The lifestyle malls, like Zona Rosa ... can capture both of those...”

What once made enclosed malls desirable has turned off many developers in recent years.

Developers now prefer lifestyle centers because they avoid the overhead costs associated with maintaining enclosed malls, said Dave Claflin, a spokesman for RED Development, which built the Legends. There are no heating and air conditioning costs, and maintenance is minimal, he said.

Claflin likened the expenses associated with running an enclosed mall to owning a several-hundred-thousand-square-foot house.

“Those expenses get paid for somehow, whether it’s the landlord or probably passed on to the tenant,” he said.

New life

Hershkowitz said many enclosed malls nationwide are being renovated to include lifestyle components. The same is true in Kansas City.

The future of the Great Mall is in flux after owner Glimcher Realty Trust announced in July that it had an unnamed buyer for the mall.

“I can tell you that anybody that purchased this is not going to keep it status quo because if you want the same results, you keep doing the same thing,” said Steve Hougland, the mall’s general manager.

“No one knows what they’re going to do, but it isn’t going to be the same old stuff.”

Two major redevelopments could begin later this fall.

Mission Center was razed in 2006 in favor of The Gateway, an 800,000-square-foot mixed-use development that will include residential, retail, office, hotel and entertainment space. Construction could begin later this fall. Recent reports indicate a 1.5 million-square-foot aquarium also will be built there.

Bannister Mall closed last year. The Trails, a 2.6 million-square-foot office and retail development including a 18,500-seat soccer stadium for the Kansas City Wizards will replace it.

“Many of the former locations or the malls that are dying or about to die are really good locations...” said Owen Buckley, president of LANE4, the developer of The Trails.

“Metcalf South is a prime example. Bannister Mall is a prime example. Almost every mall in Kansas City was and still is an outstanding location.”

As for Metcalf South, plans for a developer to partner with MD Management to redevelop the mall were announced earlier this year, but those plans have been abandoned.

Walker said different redevelopment plans for Metcalf South and Metro North are planned, but wouldn’t reveal any details.

Saplata, who walks the mall with his wife, said he’s glad the previous redevelopment plan for Metcalf South fell through.

“We’d lose our walking space,” he said.

Submit an ad