The Atlanta Journal-Constitution
Metro malls survive by repurposing
Shopping centers stave off extinction by repurposing space.
As Atlantans follow the national trend of shopping online, malls across the region evolve by taking on nontraditional tenants,
At Greenbriar Mall in south Atlanta, customers can do more than buy clothes, home furnishings or lunch. They can also pay a Georgia Power bill or get dialysis treatment.
Soon, Southlake Mall in Morrow will be home to a business that has no physical contact with the public at all. The mall’s old JCPenney store will be repurposed as a call center, a move expected to bring 1,200 jobs to Clayton County.
As metro Atlantans follow the national trend toward online shopping and the economy keeps others out of brickand-mortar stores, big malls across the region are looking to nontraditional tenants such as Emory Dialysis at Greenbriar or Mega Mart at Gwinnett Place Mall to boost foot traffic to replace lost customers.
The change is happening for both reasons of practicali- ty and survival.
“Fortress malls,” as Atlanta expert Bob Goddard calls them, are struggling across
the nation because consumers no longer see them as the preferred shopping destinations.
When the next mall will fall in metro Atlanta is hard to tell, retail experts said. Darkened corridors where steel gates block unoccupied stores or discount wig or T-shirt shops that fill space to disguise distress are clear signs that several need resuscitation.
But malls are not always easy to shut down or reshape. Lease agreements and property issues — department stores sometimes own their land, for instance — complicate the ability of mall owners or developers to reinvent the properties, said Bob Wordes, chief operating officer of The Shopping Center Group.
“People are going to be forced to be creative,” Wordes said. “We’ll have to see how these things evolve.”
The problem for malls is that retail business is increasingly going to Amazon or other Web retailers, outlet shopping centers and so-called open-air “lifestyle centers” such as the Forum in Norcross. At the same time, once-ubiquitous chain stores such as Gap and Ann Taylor that malls could always count on are trying alternate locations amid the changing retail landscape.
“The time when malls were very successful, we didn’t have the Internet,” said Goddard, founder and chief executive officer of Compass Real Estate “Shopping is now much more about entertainment than it is about going some place to
Douglasville Arbor Place
Mall
‘The time when malls were very successful, we didn’t have the Internet. Shopping is now much more about entertainment than it is about going some place to shop.’
Founder and chief executive officer of Compass Real Estate shop.”
That has significant implications for metro Atlanta.
The area traditionally has had more retail supply than demand, and that has put pressure on aging malls such as North DeKalb or Gwinnett Place. Southlake, Sugarloaf Mills in Gwinnett and Stonecrest Mall in southwest DeKalb have either been foreclosed on or faced possible foreclosure over the past several years.
And many of the malls built within a few miles of each other — think North DeKalb and Northlake malls in DeKalb County or Gwinnett Place and Sugarloaf Mills in Gwinnett — too often cannibalized each other, the experts said.
Some metro malls still thrive. Lenox Square, Perimeter, North Point and the Mall of Georgia have maintained high occupancy without seeking nontraditional tenants because they benefit from nearby office buildings, urban density and are destinations because of their size or tenant mix.
Cumberland in Cobb County has broadened its appeal since losing “anchor” department stores by adding a Costco and sit-down restaurants like Cheesecake Factory and Maggiano’s Little Italy.
Malls that can’t adapt or find new purposes face extinction. For instance, the owners of North DeKalb and Union Station Mall (formerly Shannon Southpark Mall) in Union City plan to demolish the buildings and replace them with live-work-play shopping and living communities.
“Retail is always reinventing itself,” said Greenbriar owner Charlie Hendon, whose company, Hendon Properties, recently sold North DeKalb. “You always have to create something new as a mall and as a retailer.”
Retail experts point out that the challenges to the mall sector is not unique. Office buildings often reinvent themselves to keep pace with the times. It wasn’t that long ago that CNN Center and Colony Square in Midtown Atlanta had movie theaters and a skating rink, respectively. But changing consumer tastes convinced both to shut the attractions down.
Joshua Jones, president and chief executive officer of Atlanta public affairs firm Red Clay Communications, said malls are different because they are one of the biggest economic engines for communities and sometimes have required municipal tax dollars to get off the ground.
“Each time a mall clos- es, local counties and municipalities lose a critical source of sales tax revenue, much of which has already been bonded and spent based on specialpurpose-local-optionsales-tax referendum,” he said.
They also act as central hubs for communities. Because of ample parking and proximity to interstates in car-centric Atlanta, they are favored by charities, government agencies or health organizations for meetings or public rallies.
Metro bus systems and MARTA made sure to include mall stops on their routes.
Atlanta is not feeling the pinch alone. Nationwide malls that once pulled in hundreds of thousands of visitors during their heyday, such as White Flint in Washington, D.C., or East Lake in Tampa, are either destined to meet the wrecking ball or have been repurposed.
White Flint is expected to be re-invented as a live-work-play community while East Lake, built in the 1970s, was transformed into a call center in the 1990s and renamed Net Park.
Dave McMullen, cofounder of consultancy Redpepper, whose clients include Kirkland’s and Claire’s, is optimistic malls will find their footing because they remain part of our social fabric.
“Malls act as a traditional ‘main street’ for many communities,” he said. “In so many ways social media is taking the place of a true town center and providing that social glue. But people still crave and need a central area in their community where they can come together.”