These days, mall shopping is a hard sell
Even before Covid, Charlotte-area malls were struggling to compete in the digital age. Now, they must find a new reason to exist.
The following article appeared in the Sept. 24, 2021, edition of The Charlotte Ledger. Sign up today for smart and essential local news in your inbox:
QUIET AT CENTER COURT: Starbucks sits dark on a recent weekday afternoon at Carolina Place Mall, which has seen a small lift in the number of visitors in recent months but still lags far behind the number of shoppers it served in 2019.
by Cristina Bolling
The children’s department in Northlake Mall’s Belk store is a lonely place on a Tuesday afternoon.
A single shopper circles with an armful of toddler boy clothes, but frustrated at finding no salesperson to ring him up, puts them back on the rack and walks out into the nearly empty mall.
A couple hours later and 22 miles south at Carolina Place Mall, the glass doors to JC Penney’s upstairs mall entrance are locked, with a paper sign telling shoppers to use the downstairs entrance.
The Starbucks near the food court, which once buzzed with caffeine-seeking shoppers, is dark and shuttered. A worker at the sushi stand nearby shrugs. “It’s been like that for two or three weeks,” she says.
Shopping malls in Charlotte and across the country, especially what are called “B-level malls” like Carolina Place and Northlake, were already hurting before the pandemic. But Covid lockdowns, the shift to online shopping and a labor shortage have accelerated their decline.
Macy’s and Sears both closed at Carolina Place years ago. Northlake went into receivership in May, after it defaulted on its property loan in 2019 and failed to make debt payments.
The fall of the national department store model is partly to blame. Once a powerhouse of the retail sector, department stores began declining long before Covid boosted online shopping and tipped many into bankruptcy, including Charlotte-based Belk.
And mall shopping isn’t the recreational activity it once was for so many. Browsing the Levi’s racks isn’t as alluring now that shoppers know they’re available online with the touch of a cell phone. Malls are now competing with cell phones for consumers’ free time, and even teenagers would often now rather hang out at an outdoor shopping center like Birkdale Village or Blakeney than an indoor mall.
Fewer shoppers: Data shows the number of Charlotte mall visits inching upwards in the months following stay-at-home orders, but the number of shoppers still lags far behind what it was pre-pandemic.
Northlake Mall, for instance, saw 25% fewer visits last month than it did in August 2019. In March 2021, Northlake saw a whopping 41% fewer visits than it did in March 2019, according to data from traffic analytics platform Placer.ai.
At Carolina Place Mall, owned by New York-based Brookfield Properties, shopping trips were down 13% last month from where they were in August 2019.
Charlotte-area malls saw modest increases in visitor traffic in recent months, but the number of visitors still lags behind 2019 levels. (Data from Placer.ai)
Both malls are shells of their former selves.
Northlake, now maintained and operated by Syracuse-based Spinoso Real Estate Group, has an empty anchor space where a Dick’s sporting goods store once operated, and the interior of the mall is dotted by empty storefronts.
The food court Chick-fil-A had a paper sign posted Tuesday afternoon: “Temporarily Closed. We look forward to serving you again soon.” The busiest place in the mall that day by far was the Apple store, which held about 50 people around 3 p.m.
A portion of the second floor is closed to shoppers inside Belk at Northlake Mall.
At Carolina Place Mall, the former Sears is temporarily occupied by a Halloween Express, and popular inside-the-mall retailers that once drew destination shoppers like the Disney Store and Gymboree have been replaced by stores like Leggings Park, selling $10-$17 leggings and Suit City, where blazers go for $34.99.
Less pain at SouthPark: The situation is strikingly different at high-end SouthPark Mall, which saw only a 4% drop in shopping trips in August 2021 compared with 2019, and a 4% increase in trips in July 2021 compared with 2019, according to Placer.ai data.
High-end brands draw shoppers who want the experience of seeing and feeling luxury goods, and luxury retailers continue to open storefronts in SouthPark despite mall hours that have been reduced due to Covid and a worker shortage.
Golden Goose, an Italian sneaker company selling $500 pre-worn looking sneakers, opened in SouthPark this summer, and an apparel brand named Psycho Bunny will debut its first Carolinas store in SouthPark in November, featuring $75 graphic T-shirts and $300 puffer vests.
Andy Misiaveg, a partner in the Charlotte office of Atlanta-based Shopping Center Group, said Covid has made the shopping mall business even more stratified, with larger high-end malls like SouthPark getting stronger while B-level malls like Carolina Place and Northlake “taking some lumps.”
Large, enclosed malls were overbuilt during the 1980s and 1990s, Misiaveg said, and for years anchor stores “have all been selling pretty close to the same thing and cannibalizing each other.”
“This is a continuing evolution of what we’ve seen,” he said. “The next phase is, what’s going to occupy those?”
Go-kart tracks and call centers: Entertainment venues are one likely answer, Misiaveg said, as national companies like Andretti Indoor Karting search for new markets to put go-cart tracks and arcades. Or stores known as “junior box retailers” like TJ Maxx, Hobby Lobby or Marshalls could likely move in.
Some “C-level” malls, like Eastridge Mall in Gastonia or Galleria Mall in Rock Hill, may see big boxes transformed into churches, call centers or community colleges, Misiaveg said.
Carolina Place may be a good case study for how a B-level mall can transform. The Macy’s has already become a Dick’s, and a Dave & Buster’s entertainment venue has opened nearby.
Specialty retailers like REI and Barnes & Noble already draw specific types of shoppers to Carolina Place, and Misiaveg said it’s conceivable that the former Sears space could house a business that’s new to the Charlotte market, or it could be torn down and replaced with apartments or a hotel.
Transforming vacant retail space into cool entertainment venues like a Meow Wolf (offering “immersive and interactive art experiences”) may seem like a no-brainer for struggling malls, but they come with challenges, Misiaveg said. Mall owners either need to retrofit the spaces to meet the needs of the new tenants — which in the case of a go-kart track or an immersive art experience can be costly — or they need to turn over the spaces at a very affordable rate.
“A lot of the companies that own these properties are severely indebted right now,” Misiaveg said. “To pull money to redevelop these spaces … is a costly proposition for these landlords.”
Cristina Bolling is the Ledger’s managing editor: cristina@cltledger.com
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Executive editor: Tony Mecia; Managing editor: Cristina Bolling; Contributing editor: Tim Whitmire, CXN Advisory