Some Dead Malls are not dead anymore
Let’s face it. Traditional malls in the U.S. are in decline and the trend is unlikely to stop as strategic anchors such as department stores like Sears or Kohl’s have recently announced that they will continue to close dozens of stores throughout the country. Read my article about the “US Retail Bloodbath” Here.
While this has been a problem for decades, it has been worsened by the economic downturn combined with competition from online shopping.
Anyway, some investors are taking advantage of the situation and are buying failing malls to convert them into retail centers targeted at the Hispanic community. And the least we can say is that this community is a strategic customer target: Hispanics have accounted for more than half the population growth in the US since 2000 ; Latinas have more children than non-Hispanics; Hispanic households that earn $50,000 or more are rising at a faster clip than total U.S. households. Their households outspend other groups on beauty products, food and apparel, according to Nielsen Co.
The Legaspi Company is one of these investors that specializes into creating one-stop shopping for the entire Hispanic family: grocery stores, dental care, medical care, immunization, clothes, entertainment and banking. The company has already 3 shopping malls and is currently developing dozen others. It has also recently partnered with Macerich, the third largest owner and operator of shopping centers, to expand its business.
The team believes many ailing malls could be revived by luring Latinos with a combination of live entertainment, children’s rides and adjustments to the mix of retail and food options. Such amenities can help draw an important and growing demographic amid escalating competition from online shopping. The malls host regular concerts, mariachi band classes, and holiday festivities. The effect is like an international bazaar where the community comes to hang out.
Where there are vacant department stores, local entrepreneurs open stalls and kiosks, as a kind of retail incubator. The malls’ revenue spiked 20 percent after Legaspi made the changes. Even the sales at the department stores that remain in his malls have increased, too, because they can target their products and marketing to a specific community.