Big, bold and broken: is the US shopping mall in a fatal decline?

Once at the heart of the US consumer experience, the ubiquitous mall is in crisis. Of 1,200 across the country, just 50% are expected to be in business by 2023

Twenty-five years ago this August, the Mall of America, Americas largest shopping mall, opened its many, many doors for business. The Minnesota mall is currently wrapping up a year of celebration at the dizzyingly vast temple to consumerism. Its a celebration that comes, ironically, as Americas malls are dying. But not the Mall of America.

Once the epicenter of American retail, malls are in crisis. Pictures of dead malls, their hollow shells left like abandoned sets for a George Romero zombie movie, are rapidly replacing pictures of decaying Detroit as the go-to image for dystopia USA.

It has been three years since a major new shopping mall opened in the US, leading even some mall operators to speculate that the last one has already been built. Of the roughly 1,200 spread across the country, less than half are expected to be in operation five years from now.

As usual, the internet gets the blame. The shift to online shopping has taken its toll on traditional mall anchors, such as Macys, JC Penney and Sears. But there are other issues. America has too much retail space and too many crappy malls. Its much less about technology than it is about overbuilding, says Bruce Batkin, chief executive of Terra Capital Partners, a commercial real estate lender.

The Mall of America is different and its survival points to what has gone wrong in retailing and where it is heading. Its a shift that will have profound consequences.

Quick Guide

What is the Mall of America?

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Opened in 1992, the Mall of America is the country’s largest shopping center.

It occupies 5.6m sq ft and is in the midst of expansion.

Based in Bloomington, Minnesota, the mall is the towns largest employer, with 11,000 workers on average and 13,000 during peak periods.

More than 40 million people visit annually.

It has 520 stores.

Some 8,700 weddings have taken place at the mall.

It is covered by eight acres of skylight.

The mall has its owncounter-terrorism unit.

Pests on its 30,000 plus plants are controlled naturally, including through regular releases of thousands of ladybugs.

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On a recent visit, the Mall of America hummed with visitors. Its owners, the Triple Five Group, manage several mega-malls and their staff programme its spaces with fanatical attention to detail.

In the early morning, clubs of elderly mall walkers go through their paces across the sites smooth, safe floors overlooked by the ever-present security.

By mid-morning, the older people have given way to young mums and children attracted by Nickelodeons indoor theme park, which forms the core of the building. Then theres the lunch crowd and later gangs of giggly teens slurping smoothies. A light show closes the shopping day under its huge glass roof. The specially commissioned song is titled: Always Here for You. But Mall life continues into the night with its cinemas and restaurants, some of which are open until midnight or later.

Safe, clean, controlled and always a pleasant 70F, the mall attracts 40-plus million people a year 3-5 million from overseas, with UK visitors making up the largest segment. Bargains are not Mall of Americas selling point (although it probably helps that the state has no sales tax on clothes). With its cinemas, an aquarium, rides, hotels and conference-goers, Mall of America is betting on more than shopping to keep itself in business.


Children
Children play in the touch seapool at the aquarium at the Mall of America, Minnesota. Photograph: Nick Fay

Christopher Grap, senior manager of experiential design, breaks into a Cheshire cat grin as we approach the the edge of Nickelodeon Universe. We stop to watch as a family take a photo on a bench made to look like an exploding dollop of the childrens networks trademark green slime. Wait, whispers Grap. Ten seconds after they have settled in, the bench starts to fart and burp, and the family erupts in giggles. Somehow, I snuck a farting chair into the Mall of America, he laughs.

Graps background is in film production, including working on the far darker Hellraiser movies and Dracula 2000. He says what he is looking for are scene-stealing moments. Its a playground. We are creating unexpected moments. People want physical, tactile experiences they can be part of, he says.

As part of the 25th birthday bash, the mall employed a poet. Over five days, Brian Sonia-Wallace crafted poems on his manual typewriter for shoppers who spilled intimate details of their lives while sitting outside Anthropologie. Of the roughly 100 people he wrote for, 25 cried.

It was a strange and wonderful experience, says Sonia-Wallace. I was a little skeptical at first. He was worried the mall would be soulless, its staff too controlling, too corporate. Someone told him this wasnt a shopping mall but a themed entertainment destination, he says with a slight shudder. The more time he spent there, the more it started to remind him of immersive theatre the type of drama where the crowd becomes part of the action. These are creative people looking to solve a problem artists as well as retailers are facing, he says.

 

We are all struggling in the age of Netflix and Amazon Prime to get people out of the house, how do you get them out of their bubble? he says.

Jean Anderson, 76, asks Sonia-Wallace to write a poem for her husband Ron, 79. Ron is one of the malls early morning exercisers. Anderson and Sonia-Wallace discuss the couples 57 years of marriage, their church, the letters he wrote to a cousin in prison. The typewritten poem begins:

The footsteps of your

walking echo through

halls of memory …

The h in halls has been typed twice. It looks a little like an m.


Poem
A poem by Brian Sonia-Wallace. Photograph: Dominic Rushe

Her husband loves walking at the mall, Anderson says. Hes met so many different types of people. You cant do this on a computer.

That is the general reaction from shoppers at the mall. They want to get out of the house, meet people, see something. Another of Sonia-Wallaces subjects has just come off a five-day silent retreat. She wanted some Dippin Dots [the self-styled ice cream of the future], he laughs.

Mall of Americas celebrations arent over yet but the team is already hard at work on Christmas. Planning for the holiday starts in February. The mall has sackfuls of Santas: theres a Santa who knows sign language, and a Santa by appointment for people who dont want to wait. We have to provide an experience that is worth getting out for. Attention to detail is everything, he says.

Theres a goofy, good natured naffness to the Mall of America. Its staff loves breaking Guinness records and the mall is planning the worlds largest gathering of people wearing conical (birthday) hats for August. The mall was host to a number of other record breakers, including the worlds largest handbell choir.

In a space this large, something needs to be happening. And those happenings keep people coming back, said Grap. The mall gets more than a million visitors each year from Chicago a 90-minute flight away. They can get anything you can get here in Chicago, except the experience, he says.

Mall of America is a lot of things to a lot of people. Its a glimpse of the future, a vision of the past, a safe space, a censorious enemy of free speech that took out restraining orders to censor protests by the Black Lives Matter movement. It is also one of the reasons that Americas malls are dying. A Wells Fargo study of dead malls found that competition from newer malls was the most common cause of closures.

With competition so fierce, retailers want to stick with the winners and will soon dump, or avoid, what looks like a failing mall.

Michael Sedlacek is the owner of Worker Bee, a group of beekeepers and artisanal skincare formulators started in a small space in downtown Minneapolis. Last year, they took the plunge and opened a store in the mall. The shop has a raw-honey-tasting bar with a golden rainbow of different styles. Theres firewood honey from Yukon, dandelion honey from Quebec, knotweed from Pennsylvania.

We could do this online but people respond differently here, he says. I had someone in recently who said: This honey reminds me of my childhood in Eastern China … Its a lot more personal.

But nor is it for the faint hearted. The store is in operation 12 hours a day all but three days of the year. Sedlacek declined to say what he pays in rent for his 600ft-store but does say he cant imagine doing it anywhere else. We need a lot of people to make a lot of small purchases to survive, he says.

You have to be realistic. The internet has changed business so much. Buyers are confused right now. Half of them want to sit on the couch and get everything delivered and the other half want to go out and taste some weird honey that tastes like marshmallow, something they have never tried before.

While confusion reigns, Sedlacek is probably best staying where he is. Mark Cohen, director of retail studies at Columbia Business School and a former senior retail executive at Sears and the Gap, thinks the Mall of America will survive the great retail apocalypse but he still expects an epochal reshaping of the landscape.

Customers will always want to physically shop ; the internet is not going to eliminate brick and mortar by any means, he says. That said, most of Americas malls will close, he predicts.

When a specialty store goes bankrupt or closes in the Mall of America, the customer doesnt notice it because the mall is able to lease the space quickly. Smaller malls start to look increasingly like an empty restaurant and customers start to avoid them. They not only have less to offer; they also look effectively abandoned, he says.

Bigger malls have always cannibalized their lesser neighbors but the shift to internet shopping is fundamentally rewiring retail, he says. It has hollowed out these spaces in the same way that these spaces hollowed out downtown retailing in the 1960s, 70 and 80s. The cycle is running its course once again.

That shift is likely to have a profound impact on the US economy. The retail industry is the largest private employer in the US, according to a study conducted by PricewaterhouseCoopers for the National Retail Federation, supporting some 42m jobs directly and indirectly.

The death of Americas malls may not affect cities in the same way that their birth did, destroying many of the countrys downtowns. But the shift from brick-and-mortar stores is already reshaping the employment market. Just as Macys, Sears and co used to anchor US malls, retail employment has been a solid anchor for the jobs market, generating on average 200,000 jobs per year in the 2014-6 period. The retail industry has lost an average of 9,000 jobs a month this year, according to the Bureau of Labour Statistics, compared with average monthly job gains of 17,000 last year. In a recent report analysing the data for January to May, Robin Brooks, chief economist of the International Institute of Finance, said the sector was on course to lose 110,000 jobs on an annualized basis.

Coal mining, an industry championed by president Donald Trump, employs about 80,000 people. Perhaps he should be campaigning for mall workers.

America will probably never lose its appetite for shopping: There is no shortage of customers. Human beings have retained the gene that means that we need to acquire things we dont really need, says Cohen.

Years from now the Mall of America will still be standing, but the future of the malls of America looks far less certain.

Read more: https://www.theguardian.com/us-news/2017/jul/22/mall-of-america-minnesota-retail-anniversary

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