5Qs for Nikki Traff on mall tenants going to outdoor centers
It used to be that certain retail brands would always be found in enclosed malls and certain others would always be found in outdoor centers. But since the onset of COVID-19, more mall-exclusive names are branching out to neighborhood shopping and town centers. Colliers International’s executive managing director Nikki Traff has helped guide some of these efforts, and has claimed to increase net operating incomes for landlords by $2 million in 18 months by re-tenanting shopping centers. We spoke with her to find out more.
Aside from the fact so many malls were shut down during the pandemic, why do mall brands seek a presence in outdoor shopping centers?
Retailers want traffic, and outdoor centers have more of it. The average shopping center wants regular customers to visit three times a week and spend a minimum of five hours on the property. A typical mall is going to get only two or three visits a month from regular customers.
Read More 5Qs...
Are they figuring that most of those customers going into neighborhood centers to do grocery shopping are the same female customers who go to the mall to buy apparel, beauty products, jewelry?
Exactly. Female customers make frequent stops at their local shopping centers, and not just to do the grocery shopping. They’re buying beauty products. They’re going to OrangeTheory or spin. Then enjoying coffee or eating with friends and family. They hit that center multiple times for various purposes each week.
And we’re guessing that applies to male customers, too?
Men shop differently than women, but men like the convenience of an outdoor center, as well. They’re going to have male-oriented and female-oriented shops situated closer together. And the food and beverage component is a strong draw for both sexes.
Are the millennials and Gen Z’ers who will make up the largest shopping population in the near future less geared to the enclosed mall than baby boomers?
My parents are boomers. They traditionally don’t shop online. Only for convenience. They still prefer to do a lot of shopping in stores. Millennials are going to be more hybrid in this regard. They are comfortable buying apparel online, but they still want to go out and try on and touch and feel certain things. Millennials and Gen Z are going to continue to be big customers at the growing food and beverage establishments at shopping centers and town centers.
I believe the A malls will still attract all generations as they have the right tenant mix of up-and-coming retail, luxury retail. and strong legacy retailers. The B and C malls will have a harder time attracting the millennials and Gen Z, and that will benefit nearby open-air centers. Tenants in the B and C malls will look to open-air centers with more daily foot traffic and better sales per square foot.
What does the future look like for open-air centers
We will continue to see open-air centers become more community-centric. They’ll have tenants that create an 18-hour experience--boutique fitness, health and beauty, soft good retail, grocery stores, and a mix of restaurants. Consumers will keep going to these centers for the convenience of their parking and the fact that they serve as one-stop-shops that can meet all of their daily needs.