Even before the Covid-19 pandemic hit, consumers were moving to online purchases en masse. The shift to quarantine quickly shuttered many already struggling retail businesses. Several mall-based companies — such as JCPenney, Neiman Marcus, Lord & Taylor, Brooks Brothers, and J.Crew — had to file for bankruptcy protection.
But there is good news. As retail businesses reopen, they are actually seeing more customers than they did pre-pandemic. National mall visitor metrics exceeded pre-Covid-19 levels by 5% this year, and hardware stores saw a 36% increase in traffic.
Businesses that made it through the crisis now have a chance to reinvent themselves as they reopen their doors. Developers and entrepreneurs are rethinking the possibilities for these spaces to meet current needs.
There is plenty of opportunity for commercial real estate businesses, developers, and entrepreneurs seeking to revitalize large retail spaces or shopping malls — or overhaul those spaces in 2022 and beyond for new uses. Here is how to get started:
Retail properties endured a disruptive year in 2020, but they seem to be roaring back to life with reopenings. Business owners and investors just have to adopt a future-first mindset as they expand portfolios, lease properties, and reinvest in communities in this environment. The more you can see change as an opportunity for growth, the more successful you will be in revitalizing your businesses. These have been trying times, but now you have a clean slate — and it is up to you to decide what you want to do with it.
Just because your business was one thing before the pandemic does not mean it has to assume the same identity now. As customers start shopping in person again, opportunities abound for uses of large retail spaces. Many proposed uses for these properties include updated workspaces for businesses, additional warehouse space for companies, and fulfillment centers for the continued growth of online purchases. Some mall building owners are considering creating community living room spaces in malls where people can socialize, which local businesses can sponsor for naming and event usage rights. What could your building be with a bit of imagination?
Survey the community to see where the demand is. Some owners are building concept destinations — such as health and wellness centers that combine clinics and spa services — within their spaces. This is on the coattails of the success of Mall of America’s Crayola Experience attraction, which filled a vacant space left by Bloomingdale’s. Even Google has jumped on board the “creative use” bandwagon, leasing a Los Angeles shopping center for its office campus. The key is to understand what your potential customers want and find ways to bring it to them.
Shopping centers and large retail spaces certainly experienced hard times last year, but innovative approaches can help revitalize these properties and open up opportunities for new ways to use these spaces in the future. Your business can rise stronger than ever by starting with an open mind, getting creative with the new identity your building could assume, and keeping the community involved in the conversation.
Interested in learning more about the financing opportunities available to owners and investors looking to revitalize their commercial real estate spaces? Contact Cathay Bank to learn more about our short- and long-term financing options to help you through the phases of your business revamp.
This article does not constitute legal, accounting or other professional advice. Although the information contained herein is intended to be accurate, Cathay Bank does not assume liability for loss or damage due to reliance on such information.