Retail-to-residential conversions are in cards at America’s doomed malls

The coronavirus pandemic could accelerate the residential conversion trend

New York Weekend Edition /
Jul.July 04, 2020 09:00 AM
Malls are hemorrhaging retailers left and right. What will happen with all that space? Some could be converted into apartments and condominiums. (iStock)

Malls are hemorrhaging retailers left and right. What will happen with all that space? Some could be converted into apartments and condominiums. (iStock)

Mall vacancies are surging, so what to do with all that empty space? Apartment and condominium conversions could proliferate.

Some developers were converting properties before the coronavirus pandemic hit, but the pandemic has made the concept more attractive, according to Bloomberg.

Randy White, CEO of consulting firm White Hutchinson Leisure & Learning Group, said that “a lot of these malls thought restaurants and entertainment would be their savior, the new anchors.”

“Those hopes are dashed,” he said. “There’s even a question if movie theaters are going to survive.”

Half of all mall anchor department stores are expected to close by mid-2021, by some projections. That would leave huge swaths of real estate vacant and likely lead to closures of other, smaller stores.

Last year, Brookfield Properties partnered with AvalonBay Communities to convert a chunk of the aging Alderwood Mall outside Seattle into 300 apartment units. Around 90,000 square feet of retail space will remain.

A Brookfield spokesperson said the project caters to evolving preferences of consumers.

“Today, people prefer to live in smaller spaces and want walkable developments rather than relying on vehicular transit,” they said.

Last week, the Trump Administration announced it was exploring ways to turn vacant commercial space into affordable housing. Ben Carson, Secretary of Housing and Urban Development, said that the federal government would work with local governments to facilitate conversion projects. [Bloomberg] — Dennis Lynch 


Related Articles

arrow_forward_ios
(iStock)
Canada’s biggest city has just 3,200 homes for sale, an all-time low
Canada’s biggest city has just 3,200 homes for sale, an all-time low
Douglas Elliman sends NYC employees home as Omicron surges
Douglas Elliman sends NYC employees home as Omicron surges
Douglas Elliman sends NYC employees home as Omicron surges
Aloha: Buyers can’t snap up Hawaii’s luxury homes fast enough
Aloha: Buyers can’t snap up Hawaii’s luxury homes fast enough
Aloha: Buyers can’t snap up Hawaii’s luxury homes fast enough
Open-air shopping centers came out ahead of retail’s recovery with a 10-year high in net absorption in the third quarter, per CBRE.
Open-air retail complexes enjoy breath of fresh air, hitting new peaks amid recovery
Open-air retail complexes enjoy breath of fresh air, hitting new peaks amid recovery
John Paulson with Condado Vanderbilt Hotel and La Concha Renaissance San Juan Resort (Condado Vanderbilt, Marriott)
Billionaire John Paulson wants to sell two Puerto Rico hotels as market rebounds
Billionaire John Paulson wants to sell two Puerto Rico hotels as market rebounds
U.S. shopping mall values have struggled in recent years before valuations tanked in the wake of the pandemic amid an e-commerce boom.
US mall values plummeted by one-third in 4 years
US mall values plummeted by one-third in 4 years
ICSC’s Here, We Go event in Las Vegas
Fear and loathing at ICSC’s resurrected Vegas conference
Fear and loathing at ICSC’s resurrected Vegas conference
New York City has largely regained residents who fled in the pandemic
New York City has largely regained residents who fled in the pandemic
New York City has largely regained residents who fled in the pandemic
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...