Fifteen years ago, the Lakes Mall in Lauderdale Lakes, Fla., was a showplace. It isn't anymore.
Instead, it is a stark example of a decline in suburban enclosed malls. The decline is expected to continue far into the future.
Back in the middle to late 1970s, the Lakes Mall was like popular, modern malls everywhere: One or more big "anchor" stores owned by giant department store chains, a multi-screen movie theater, a food market, a sizable pharmacy and dozens of smaller specialty shops. The place was crowded each day from the moment it opened to the moment it closed. Its biggest competition was the Lauderhill Mall, a mile or so down U.S. 441.
Today, the Lakes Mall is, essentially, dead. A few small shops still operate there or on its periphery, not unlike the lichens that thrive on the trunks of dying trees. Down the road, the Lauderhill Mall is not what it once was. The busiest storefront there is the one where residents renew their automobile license tags.
What happened? More to the point, why did it happen? Must this TC decline continue? Here's the gist of what marketing and demographic experts are saying:
The philosophy behind successful shopping malls has been to lure a big chain store, either one of the standard department retailers or a discount house, to serve as "anchor." Other stores might come and go, but shoppers like you counted on the big department store being there. The other, smaller stores then would benefit from business drawn by the anchor. The phrase "one-stop shopping" took on new meaning in these suburban centers.
For decades, it worked. Malls grew to resemble giant spaceships -- they seemed capable of sustaining life indefinitely. You could go inside and, presuming you had enough money, you could stay there, it seemed, forever. All your needs were met, save, of course, for sleeping accommodations.
But then the big retail chains got into trouble, the victims of Wall Street greed, the excesses and chicanery of the 1980s. Buyouts transformed many once-thriving chains into little more than appendages of bankrupt conglomerates. They or their parent companies took on heavy debt. One by one the anchors folded and left, leaving the malls to drift aimlessly.
Meanwhile, finding competent and reliable employees became increasingly difficult. This occurred as direct marketing and shopping by phone began to take off. Why deal with indifferent, ill-informed store employees, shoppers reasoned, when a quick phone call would yield a friendly order clerk who knows the merchandise well, can guarantee delivery within a day or two and offers liberal guarantees and return policies, often at lower prices? And all without leaving the house.
An additional problem arose when the redundancy of products in malls became evident. It was possible to find the same item at the same price in a dozen stores in a particular mall. It was as though a study had determined the ideal small shop for a mall, and everyone followed the resulting advice specialty boutiques catering to young to middle-aged women.
The South Florida situation illustrates another problem: New malls do well, at least for a time, in new population centers. The heyday of the Lakes and Lauderhill malls came when their respective cities were on the leading edge of westward growth in Broward County. Now the new homes are being built several miles to the west. New malls being built in that area are thriving -- for now. Some of the more established malls, located in areas where growth is stable, are holding their own with an established clientele.
The outlook is not bright. Marketing consultants estimate that from one-fifth to one-half of the existing malls will go out of business before the turn of the century. Smaller strip stores seem to be doing at least as well as malls, at lower rents.
What does this mean to you? It may make your shopping less convenient. If you haven't visited your nearby mall recently, you are likely to be surprised or depressed by the changes. Remember when the place was so lively that it seemed it would stay in business forever? That was just a few years ago. For lenders, investment in a shopping mall appeared to be a sure thing. Now, it seems, it wasn't so sure.