Malls no more, centers looking to sell lifestyle
(9/13/2007) Malls used to be places for long shopping excursions.
But with many time-starved consumers wanting to park, shop and get home fast, spending the day shopping has lost some of its appeal. In an effort to get those customers back and perhaps attract new ones who will linger, five area malls are remaking themselves by adding upscale restaurants and shops.
Those shopping centers - in Baltimore, Towson, Annapolis, Bel Air and Laurel - join others locally and nationwide in renewals designed to adapt to shoppers' changing habits. Consumers now have a host of retailers competing for their dollars, from boutiques to big-box stores to online merchants.
All the malls under renovation are embracing the "lifestyle center" approach in one way or another as the concept grows in popularity. Other projects that followed a "lifestyle" concept include Hunt Valley, the Avenue at White Marsh and less-dramatic transformations in Columbia, all of which combine an exterior avenue of shops and restaurants surrounded by easy-to-reach parking areas.
"Twenty years ago, consumers would go in and spend three, four or five hours in a mall shopping," said George Whalin, CEO of Retail Management Consultants in California. "Now they're looking for an entertainment mall with a movie theater and restaurant. They're looking for malls that are easy to get in and out of so they can get what they want and leave."
Harford Mall in Bel Air just completed an 18-month renovation to upgrade its 1970s look and add an outdoor shopping area and more restaurants. Westfield Annapolis Mall is undergoing more than $100 million in upgrades that will include a 240,000-square-foot addition and 60 new retailers. It also will include new entrances, lounges and valet parking.
Towson Town Center is expanding by more than 100,000 square feet with a project that will add restaurants and parking. It also is remaking its first and second floors, with plans to lease to more upscale retailers. It is the mall's biggest expansion since Nordstrom opened there in 1992.
Mondawmin is in the middle of a $70 million renovation that will include a Target, two restaurants near the mall and landscaped entrances. And Laurel Commons is being transformed into an indoor-outdoor lifestyle center.
The malls are using design concepts similar to those that area competitors recently have championed with success.
In 2001, The Mall in Columbia completed a three-year expansion that included a free-standing cluster of restaurants. At the time, mall executives said they were focusing on "entertainment and outdoor ambience."
Two years ago, crews at Hunt Valley Mall, now renamed Hunt Valley Towne Center, removed much of the enclosed mall and replaced it with a Main Street-style outdoor shopping area.
Louis Kokkinakos and his wife, Maria, said the outdoor areas at Columbia's mall remind them of Greece, where they lived for 10 years. The Clarksville couple, who were having lunch yesterday at a table outside the mall, said the additions were an improvement.
"You have more choices now," said Louis Kokkinakos, who said he's not really a shopper. "You can come at night just to have a cup of coffee outside."
Sandy Speace, a retired teacher from Glenelg, said the crowded parking lots are evidence of the popularity of the restaurant area.
"It was definitely an improvement," said Speace who was shopping yesterday with a friend at Land's End. "It's much better than it used to be."
Executives for General Growth Properties, which owns the Towson and Mondawmin malls, said those centers are profitable and have continued to draw customers. But the buildings needed upgrades, they said, to stay competitive.
The first two floors at Towson Town Center, for example, weren't easily navigated and needed a more consistent tenant mix to conform to the rest of the mall, executives said. Mondawmin, which was built in 1956, had its last renovation in 1982. The architecture was dated and the mall was hard to get in and out of, General Growth executives said.
The renovations at both malls are "asset protection," said Bill McDermid, a vice president with General Growth Properties. "We've got to stay current, relevant and the best game in town."
The makeovers at the various malls also include more outdoor entrances that lead directly to stores and the new restaurants that are being added. Malls have discovered that not everyone wants to stroll through an entire mall to get to a favorite store.
According to the trade group International Council of Shopping Centers, the nation's malls are experiencing more renovations because fewer shopping centers are being built. It's too expensive and time-consuming to construct new malls and there is not enough available land to build on, retail experts say. They also say malls need to renovate every decade or so to stay relevant.
"Habits have changed. Retail has changed since [some of the malls] were built," said Malachy Kavanaugh, a spokesman for the International Council of Shopping Centers. "Malls have to create a fresh new environment for consumers because there are so many places to shop."
The mall industry experienced a shakeout during the past decade. Centers that couldn't compete with the proliferation of big-box stores and specialized shopping went out of business or changed formats.
Harundale Mall in Anne Arundel County was the first enclosed mall on the East Coast when it opened in 1958. In the next half-century, 26 more traditional, enclosed malls were built, but only 12 survive today in the Baltimore area, according to research by investment firm Stifel Nicolaus.
Harundale was transformed into a big-box store and its name changed to Harundale Plaza in 1999. Glen Burnie Mall, which is now called Glen Burnie Town Centre, had a similar fate the same year. Golden Ring Mall, which was built in 1974, lost customers and retailers to larger, more modern malls such as White Marsh and Towson Town during the mid-1980s. It was closed in October 2000 and was replaced with a Sam's Club, a Home Depot and several smaller stores and restaurants.
Some niche neighborhood malls and the more upscale shopping centers are thriving, retail analysts say. Those analysts add that there is a demand for space in the malls that do well, allowing developers to push for rents 20 percent higher than in the past.
"Because there is a lack of construction, they're able to ask for more," said David Fick, managing partner at Stifel Nicolaus. Fick said the malls often promise the retailers an increase in customer traffic as they upgrade the centers and add more tenants.
Fick said there are still shoppers who want to spend time browsing in malls, but they'll only do so with the right store mix. That's why malls have replaced tenants such as drug stores with more high-fashion choices. Westfield Annapolis Mall, for instance, will open Esprit, H&M and Skechers stores.
"It's our philosophy and our practice to constantly invest and reinvest in our properties," said Scott deGraffenreid, marketing director at Westfield. "We're taking an already strong and productive center and adding key new elements and energy to enhance its appeal."
This marks the largest renovation ever for Westfield, which opened in 1980. The center went through minor expansions over the years when it added anchors such as Lord & Taylor in 1988, Crown Theatres in 2000, Borders Books in 2001 and Sears in 2002.
Outlet malls owner Prime Retail was on the brink of financial disaster when it was acquired by Lightstone Group LLC in 2003. One of the first things the new owner did was to launch a multimillion-dollar makeover to improve its properties and woo back shoppers. The project included an updated look and an 80,000-square-foot expansion for the Prime Outlets at Queenstown, just south of the Bay Bridge.
The company recently announced it would do even more makeovers next year with plans to renovate and expand eight malls, adding nearly 1.5 million square feet, during the next two years.
"If you don't upgrade, you're going to go away," Whalin said.
Shoppers at Towson Town Center said recently that they look forward to the new look and additional stores.
"It's always good to expand and give shoppers more options to buy," said Mark James, a Baltimore therapist.
Ann Schneider, a homemaker from Towson, joked that it would mean more temptation to shop.
"More shops mean more choices," she said.
By Andrea K. Walker
Copyright (c) 2007, Baltimore Sun, Inc.
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Source: The Baltimore Sun