In Agawam, MA, city officials are hopeful of putting a youth center into space formerly occupied by the bankrupt retail store occupied by Steve & Barry’s. In Ft Lauderdale, FL, the high-end Galleria Mall is now leasing rehearsal and classroom space to the Ft Lauderdale Children’s Theatre.
Like a hurricane blowing in, the swirling winds of change created by the lingering recession, coupled with the demise of many big-box tenants such as Circuit City, Linens ‘N Things, Tweeter, Sound Advice and many others has created an oversupply of space in formerly very desirable retail mall and strip center sites. The landlords who are filling those spaces have recognized that dark space creates a sense of malaise that can spread like a disease to other tenants in the mall, as the public perceives that the space is no longer a place to head to as a destination for shopping.
Instead, those landlords willing to consider adjusting their rents to current conditions, or even below for non-profits, find that the influx of parents and their children help feed business to the other tenants remaining in the mall space, as well as the food courts that feed these shoppers and attendees. Landlords are utilizing shorter lease terms, rent concessions and temporary leasing as ways to attract schools, colleges, museums, performing arts centers, medical clinics, day care centers, business offices and other non-traditional mall users.
When it comes to the health of any retail center, traffic is the key. A mall that has cars in the parking lot, people in the aisles and diners in the food court, is better poised to survive these current economic times. When things stabilize, and the surviving big-box tenants need to expand, those malls who remain lit and open, and in familiar and popular locations, are going to reap the benefit of being the ones still standing and ready to do business.
by: Michael B. Katz, Esq.
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