2017 was a record year for retail stores, but not in the way they were hoping. A record 7,000 stores shut down across the United States. Now, malls are facing their highest vacancy rate since 2012.
A study by Reis, a real estate research firm, says mall vacancies hit 8.9% in the last quarter.
"It's not a sky is falling number," says San Diego State University Marketing Professor Miro Copic. "But, it is a wake-up call because every retailer that's around today has to think what experience am I giving my shopper."
Stores like Sears, K-Mart, Albertsons, Macy's, Nordstrom and Toys R Us all closed locations in San Diego in the last 18 months. That's left hundreds of thousands of square feet empty in malls and shopping centers. Copic says filling them all will take creativity.
"There's never a one-to-one replacement," Copic says. "There are different things that a real estate owner can do. They can subdivide the space, create an expansive food court or sell it to a movie theater."
Westfield, which owns several malls in San Diego County, echoed that idea. In an email to 10News, they say they use closings as an opportunity to transform malls and introduce new concepts.
Shoppers told 10News they still want to go to malls, because they like the experience of going out, trying on clothes and spending time with family.
"I used to look forward to it," says Tiffny Jones. "My mom would get paid on Friday, and we'd spend all weekend in the mall."
Now, Jones says she shops online or goes to discount stores like TJ Maxx.
That could be the future for retail, says Copic. He thinks stores that offer bargains, like the 99 Cent store or Ross, have positioned themselves well in the new economy.
The key, he thinks, is finding stores or experiences that appeal to people of all ages.
"A retailer who understands how to capture the new generation and still offer something to the current generation that's of value to them is going to be successful in the long term."
