Malls Sound Like A Great Idea, But People Are Giving Up On Them

Why aren't more people visiting these things?
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It's no secret to anyone that plenty of retail stores are evolving and making changes to adapt with the times. E-commerce has proved a much bigger catalyst for change. Companies like Amazon make it possible for people to do all their one-stop shopping from the comfort of their home, and there's no other way to get all your needs in one place.

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Or at least that's what I thought until I heard about what old people refer to as, "Malls."

There has been a lot of talk about these mall things lately. Everyone keeps saying they're struggling, and no one wants to visit them. But, why? They seem pretty cool. Instead of just sitting inside and shopping on Amazon, you can just walk into one big Amazon where there is food...and, like, Santa Claus?

But despite how awesome these retail centers sound, it really seems like no one wants them anymore.

As they battle the rise of e-commerce, U.S. mall owners are trying to clear their books of fading centers so they can focus on the most-profitable ones. That’s proving difficult, with just a shallow pool of investors who are willing to take on a declining mall and even fewer who would pay what the landlords want. Only about $3 billion of retail real estate changed hands in April, a 27 percent drop from a year earlier and the lowest monthly tally since February 2013, according to the latest data from Real Capital Analytics Inc.

What's even more surprising is the increase in the value of other forms of real estate that sound way lamer than an Amazon you can walk into...

Values for U.S. industrial buildings, including the warehouses that serve as distribution hubs for Amazon.com Inc. and others that sell goods online, have been wildly outperforming retail-property values for some time. A new report from Green Street Advisors LLC shows that industrial values have climbed 15 percent over the past year, the most of the 10 types of commercial real estate the research firm tracks. Over the same period, prices for malls, the worst performer, fell 12 percent.

With the value of other properties rising, and the value of malls falling, it makes sense to sell off the retail space, but there is so much potential.

People are beginning to catch onto data mining techniques from companies like Facebook, and there is pushback against Jeff Bezos' attempt to make the American people pay money to bug their own homes. With malls, you don't have to worry about personal security. Instead, the common man can apparently meander around shops, worry-free, and based on their current popularity, you can even do it without much interference from other humans.

Although the upside of selling sounds great, some people are holding out.

Landlords sitting on mediocre malls in hopes of getting a higher price at a later date may be missing their window, according to St. Juste. All indicators point to lower values in the future, he said.

“If you’re thinking about selling an asset down the road,” he said, “it would be wise to think about pulling it forward and selling now.

Most people advising a sale doubt malls, but I'm expecting malls to make a comeback at any moment. And just like when Brett Favre came out of retirement for the 3rd time, I'll be there to say, "Old stuff is cool."

Retail is evolving. Here's how businesses can survive and thrive [CNBC]

Is Alexa Listening? Amazon Echo Sent Out Recording of Couple’s Conversation [New York Times]

Landlords Are Practically Giving Malls Away [Bloomberg]

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