I was internet averse the last week so...
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Originally Posted by esquire
^ So what drives a decision to "de-mall"? Reducing the property tax burden can't be the entire rationale?
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Giving the tenant and the customer what they want. Northgate was a wasteland, and therefore quality tenants had no incentive to pay big rent and move in. Give the customer a fresh and more accessible environment (if you only have one store to visit, park right there. You don't have to find a spot, find the mall entrance, walk through the mall to the store and then reverse). Furthermore, it is easier to provide stores with greater clarity and exposure as noe EVERYONE can have exterior signage and parking.
A more appealing and customer friendly yields a greater willingness for tenants to spend on rent, ergo more profit. Wouldn't surprise me if rent has doubled.
Quote:
Originally Posted by Roger Strong
Management fads.
"Power centers" - outdoor shopping malls - are a success story in the southern US. So obviously they should be here too. You know, because there's no climate difference that would make people prefer the indoors.
Now the fad is " Lifestyle centers", outdoor shopping malls with amenities oriented towards upscale consumers.
I say "management fads", because it seems to be the real estate managers who buy into them rather than the customers. I've yet to hear someone complain that the Polo Park experience would be a lot better if they were walking between stores outdoors in the winter. Or that friends eating in the food court had to choose one restaurant and one restaurant only so that they could eat together.
The Shops at Don Mills - a lifestyle center - opened on the site of the recently demolished Don Mills Centre shopping mall. McNally Robinson opened a store there at the same time as their store at Polo Park. Don Mills was a flop, while Polo Park was a success. But with both owned by Cadillac Fairview they couldn't exit one without exiting the other. |
There is a very big difference between fads and trends. Basically, unless it's a colossus, the enclosed suburban mall is dead. Dead dead dead. And Northgate previously was deeeaaad. Polo isn't a remotely close comparison because it's the largest and best in the city, and too big a site. Furthermore, a large shopping centre is more likely to be a destination where shoppers visit multiple stores. Small suburban stores not so much, so why walk through an enclosed purgatory? Open it up!
Globally the trend has been to provide a more engaging outdoor experience, connecting stores with outdoor living spaces. Regardless of our cold climate, this is what global tenants respond to. If we say "but our climate" they'll skip past us and leave us another 10 years further behind.
Management doesn't buy into them, tenants do. Management does whatever makes the most rent, and that is attain the highest quality, highest traffic, and highest paying tenants. These tenants know what works for them globally... and while we're the coldest, we're not the only cold place. -25 here is like -5 elsewhere, so it's relative. But let's not forget that despite our complaining, we have other seasons. Unless it's the Eaton Centre in TO or Pacific Centre in Van, I prefer the outdoor space (usually not directly downtown anyway). As you said, it's prominent in successful American cities, and climate isn't the only factor.
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Originally Posted by WildCake
Probably saves landlords the headache and time of having admin staff, repair, cleaning, and security of a mall, when that becomes uniquely the retail store's problem if they are a standalone building. All the landlords have to do is sit back and collect the lease money, maybe pay an admin secretary for it, and clean/maintain the parking lot
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Some outdoor retail centres provide their own security as well. Indoor cleaning costs are save, but office staff is every bit as active. Repairs are still every bit as much of an issue also. Some failsafe's exist, such as HVAC failure in a standalone CRU now isn't shared with an entire mall, but it's also more expensive to build so many standalone buildings. Ultimateoly, the workload is no different. Well, it's higher considering that Northgate actually is 5x as busy as 3 years ago.
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