Malls Appeal to High-End Customers to Survive as Some Anchor Stores, Chain Retailers Close

Macy's announcement last month that it will close 14 stores across the nation will strip one of the nation's first suburban malls, opened in Michigan in 1954, of its final anchor tenant.  The Northland Center has been losing tenants for years and went into receivership last fall. The mall's occupancy is currently under 50 percent. Macy’s announcement came a day after JCPenney said it will close 39 stores across the country.  None of the latest round of closings are slated for Connecticut. Malls without anchor tenants are malls on life support – and even while some malls continue to flourish around the country and in Connecticut, others are fading away.  Outside of Schenectady, the Rotterdam Square mall will lose their Macy’s anchor, and already has empty corridors and large volume of empty spaces” according to a recent published report.  At least 16 storefronts are vacant, and three more have announced they’ll be departing.  Last year, among the malls that were demolished was the Woodville Mall just outside of Toledo, which opened in 1969. 

Since 2010, more than two dozen enclosed shopping malls have been shut, according to a report in The New York Times, which noted that “an additional 60 are on the brink,” according to Green Street Advisors, which tracks the mall industry.

As some malls fade from view, others build strength.  The news report indicates that “with income inequality continuing to widen, high-end malls are thriving,” while malls dependent on anchors stores such as “Sears, Kmart, and JC Penney falter.”

Malls with stores that appeal to the top 5 to 10 percent of the income scale are thriving, according to The Capital Times, a Wisconsin news site. “Contrary to popular belief, it isn't Internet shopping that's doing the most harm. Rather, it's been a tremendous buildup of more retail outlets and the failure of working-class wages to keep up with the rest of the economy.”

About 80 percent of the country’s 1,200 malls are considered healthy today, compared with about 94 percent in 2006, according to CoStar Group, a provider of data for the real estate industry, The Times reported.

The Fairfield County Business Journal reported this month that The Saks name is slated to return to the Stamford Town Center after a Saks Fifth Avenue store, a longtime tenant in the mall, closed last year.  Saks Fifth Avenue Off 5th, the fashion discount retail chain of Toronto-based Hudson’s Bay Co., plans to open in June.

Abercrombie & Fitch is closing its Hollister Co. store in the Westfield Meriden mall this month as part of a nationwide 60-store closure plan involving both the Hollister and Abercrombie & Fitch brands, a company spokesman told the Meriden Record-Journal.  A year ago, JC Penney announced plans to close about 33 stores — including its store at Westfield Meriden Mall.

Department stores, especially those that long have catered to middle-class customers, are feeling the pinch from online and discount sellers and are paring down stores, too, the Baltimore Sun reported this month. Sears said late last year that it was closing about 235 underperforming stores, the majority of which are Kmarts, the paper reported.

In the Hartford area, the region’s two major malls, Westfarms and The Shoppes at Buckland Hills, have gradually altered their retail mix in recent years, reflecting the nationwide upscaling trend, and continue to add tenants and demonstrate strength.

Andrew Sufian, General Manager of The Shoppes at Buckland Hills, emphasized that they “continually evaluate the evolving needs of the market, monitor trends and listen to our shoppers to provide the best in retail, dining and entertainment.”

He cited the recent opening of a new 26,000-square-foot Dave & Busters, expansion of H&M and “new dining experience, Maggie McFly’s, as among our most recent examples of the sought-after stores/experiences Buckland Hills brings to the community.  These additions complement our strong existing retail line-up, including Macy’s, Dick’s Sporting Goods, Forever 21, Victoria’s Secret, Barnes & Noble and many more.”

Sufian added that Buckland Hills is “a strong, viable shopping center” in constant conversations with retailers “to continue to keep our customers happy and coming back.”