Now that the holiday season is long behind us, we can only hope to rebound from the latest wave of contractions among our perpetually ailing retail sector. You know what I’m talking about. After dismal holiday performances, chains like Sears, Kmart, and Macy’s announced a slew of nationwide closures. Meanwhile, smaller, specialty retailers The Limited and Wet Seal folded completely. These announcements deliver yet another series of left-right punches to the already battered and bruised American icon to commercialism: the enclosed shopping mall. Of the malls that will soon bid farewell to their Sears or Macy’s, many have already doffed another anchor department store in the previous five years, and few have found a replacement that would use these large floorplates to their full capacity. It is hard to conceive of a mall that can continue to operate successfully if two of its anchor tenants are gone; many malls only have three altogether (and some only have two). The Eastland Mall in Columbus, for example, will be losing its Macy’s by spring; two years ago the J.C. Penney departed. Before that Eastland bade farewell to Lazarus, which reveals how long that space has remained vacant, since Lazarus hasn’t existed in any form since Federated retired the name to favor Macy’s in 2006. Thus, Eastland will have only Sears, and I’ve ruminated many times on the anemic presence of a Sears, even in the healthiest of malls.
It’s not looking pretty. While not every mall in the country is swirling around the toilet bowl, the volume of struggling ones has discouraged much new retail construction in the last few years. Enclosed malls simply lack their prior appeal, even as recently as the previous decade. Shopping typologies of comparable scale have pulled customers in other directions: among the most shameless is the power center, which amounts to little more than a series of big boxes and strip malls lined up end-to-end to form a square, rhombus, or some other configuration that features a parking lot smack in the middle. They require considerably less common area maintenance cost, are invariably auto-oriented (customers drive to different spaces in the parking lot to get to the stores they want) and usually aesthetics are nary a passing thought. They’re an unattractive imposition to exurban greenfields, but they’re awfully convenient, so people keep going to them for now. I’ve yet to find a power center with more than a 25% vacancy, so, in most respects, they’re flourishing, but I know failed power centers do exist out there, and I cannot imagine the negative visual impact of a blighted power center to the community nearby.
Then we have the lifestyle centers. I’ve rarely covered this form of retail here on this blog, but they merit an article of their own, because as recently as 2005, they seemed to represent the next generation. Malls were dying in the early 2000s, to be sure, but not at the pace of today, and experts on shopping trends largely attributed the early generations of dying malls to two factors: 1) neighborhood change (the median income and purchasing power of the surrounding area steadily declined) and 2) competition from newer, flashier malls (which opened close by and stole away the tenants and customers). Lifestyle centers played a seminal role in the latter, because, while they more or less operate other the same shopping principles as an enclosed mall—and often feature many of the same stores—they were a relative novelty at the turn of the 21st century. And new shopping experiences often turn heads.
But the lifestyle center trend has never supplanted the enclosed mall; most large metros have at least one, and they’re widespread across the more temperate climates. But they certainly haven’t morphed into “the next big thing.” Meanwhile, malls have only continued to slide in their pre-eminence; the last major enclosed mall construction—the Mall at Turtle Creek in Jonesboro, Arkansas—took place in 2006. Not a single developer has built another one. While lifestyle centers (or some hybrid between the lifestyle center and the power center) have scattered lightly across greenfields since then, shopping in the 2010s increasingly lacks a physical component. And, by 2017, the reason is obvious to just about everyone: the Internet has taken over.
Online shopping in general (and Amazon in particular) has become factor #3 in hastening the decline of the enclosed mall. By the early 2000s, it was clear that the Internet was stealing a significant chunk of revenue away from the bricks-and-mortar retailers. When two national, high profile big boxes—Circuit City and Borders Books—declared bankruptcy around the end of the decade, the prevailing sentiment was that they had failed to align with shifting consumer preferences. Their departures cast a pall on the suburban, commercial landscape, visibly escalating the big-box vacancy rate. But neither of these chains (especially Circuit City) had particularly strong connections to enclosed malls. Less than five years later, however, the major department stores are facing similar challenges, despite developing reasonably robust online components. Macy’s, Penney’s and Sears still can’t compete with Amazon. Even the most well-managed discount chains—Kohl’s, Target and Walmart—have felt the pinch.
So malls are in serious trouble, but what’s the situation with those lifestyle centers? I’m not particularly sanguine about them either.The above photos, featuring the Promenade Shops at Saucon Valley (just south of Allentown/Bethlehem, Pennsylvania) help demonstrate why. Having opened in 2006, this lifestyle center is not a big one: it features less than 500,000 square feet of space. It has no conventional department store anchors, or even a budget big box. The best-known chain of any real size is Barnes and Noble, but it also features an upscale specialty grocer (Fresh Market) and a 16-screen Carmike movie theater change with IMAX. Everything else at this would classify as an inline store.
At first blush, the Promenade Shops at Saucon Valley seem to be doing well enough. And these photos, near dusk on a chilly Monday, hardly capture the installation at its customer peak. For the Pennsylvania’s Lehigh Valley—the state’s third largest metro area—it represented the region’s highest concentration of mid-to-upscale shopping when it opened, with the only Banana Republic, Brooks Brothers, and L. L. Bean. It features the conventional main street configuration, with the aforementioned mini-anchors poised on both ends and the middle.The immediate center of the development features a Starbucks overlooking a plaza with a mini-amphitheater seating and fountains, open to musicians and splash-play in the warmer months.
But even in the dead center of it all—and the middle of malls or lifestyle centers tend to be the strongest, highest-value portions—it’s still easy to find signs of vulnerability. Notice the vacancy to the left of Pandora in the space below:And another vacancy in the background, to the far left. Let’s get a little closer to that storefront space, distinguished by the mosaic ornamentation above the windows.
It’s clearly not operational, but there’s some sign of activity; a worker was moving things around when I came by. What’s going on? Here’s a closer look:
It is—or at least was—the gift shop Go! Calendars Games and Toys. I’ve noticed that this emergent chain tends to gravitate toward cheaper locations in many malls (i.e., the spaces closest to Sears), but here it was in the dead center. And it seems to have closed. But what does the sign in the door say?
It’s operating as a seasonal store, no doubt to cash in on the demand for calendars around Christmas. It’s inevitable that even the most successful malls will feature at least a few storefronts that they lease on a seasonal basis. But it usually isn’t smack in the middle of it all.
Lifestyle centers, not surprisingly, must face the same challenges as malls when a tenant fails nationally. Here’s another example where the labelscar is easy to discern.As of February 2017, Aéropostale hasn’t yet faced the same fate as Wet Seal, but national mall managers Simon Property Group and General Growth Properties have essentially placed the once-thriving brand on life support. It might be hospice care. Over one-eighth of the Aéropostale locations have closed in the last decade. This region still claims one location—at the Lehigh Valley Mall (the most successful enclosed mall in the area)—but it closed the others. And, like many malls faced with rising vacancies, the Promenade Shops must get creative at decorating the storefronts to keep the illusion of vitality.
However, the real weakness to this lifestyle center is not so much the tenants it has lost, but those it still retains. Another storefront that faces the center plaza also hints at struggles.Capital Blue is a division of Blue Cross Blue Shield of Pennsylvania, so essentially this is a customer service outlet for purchasing, filing claims, or simply asking questions in regards to health insurance policies. It’s a strange tenant for a lifestyle center, since it’s unlikely to attract the recreational shopper, and its hours don’t synchronize with most other retailers. And it has leased space at the Promenade Shops Saucon Valley for quite some time. Just a few hundred feet away—and also facing the central plaza—we encounter another inauspicious tenant.
I have nothing against Sneaker King, but it’s a recent addition to the lifestyle center’s portfolio. And, if you look closely at the labelscar, you can see what preceded it.Barely visible traces of the letters “e-e-k”. It was Coldwater Creek, a women’s apparel store that declared bankruptcy in 2014. The brand survives online, but it no longer has any real bricks-and-mortar presence. Since the brand failed, it’s hardly a black eye to the Promenade Shops. But I’m confident that Coldwater Creek was a more upscale tenant than Sneaker King. Since the latter chain has locations elsewhere in the Lehigh Valley, it’s hardly a coup for this lifestyle center to secure the store as a new tenant. In other words, the Promenade Shops downgraded.
And here are two others:Journeys and PacSun are hardly low-end tenants, but they’re staples of middle class malls—hardly the stuff for a lifestyle center that seeks to distinguish itself as eclectic. Both also operate at the Lehigh Valley Mall several miles away, and, while I don’t know about Journeys, PacSun is hanging on by a thread, saved from bankruptcy by a private equity firm. No better than Aéropostale. And, a hundred feet further, a case of the doldrums:
Then, on the other side of the lifestyle center’s main street, we see another predictable tenant:
The grainy quality makes it tough to interpret, but it’s the omnipresent GNC. From what I can tell, the financials of nutritional supplement stores like GNC are strong, so it’s got that going for it. But GNC has over 6,000 locations in the US alone, and it’s such a predictable staple for a mall that it only further undermines the Promenade Shops’ goal of bringing in a choosy clientele. Additionally, GNC has achieved particular notoriety as one of the final tenants in dying or nearly-dead malls across the country. At least they’re resilient.
Truth be told, this lifestyle center in particular seems to recognize that retail has proven a persistently shaky foundation upon which to generate cash flow. And the management has responded by shifting the focus toward dining.
The primary travel lane along the front of the premises, parallel to Center Valley Parkway, is called Restaurant Road. The majority of the storefronts that motorists would see as they drive by are, in fact, restaurants.These days, relatively few of these high-profile locations are widely known chains. Only Cosí and Bar Louie. But the remaining, while local, still appeal to an upscale clientele. And the lifestyle center’s management seems to be catching on:
I can’t imagine a “Restaurant Week” at a conventional mall. Most malls feature fast-casual eateries in their interior, usually clustered in a food court, while the outparcels offer more conventional sit-down chains. The idea of bringing a bunch of restaurants together for a special deal seems inconceivable. But the Promenade Shops, to keep their vacancy rate down—and I’d estimate it’s stuck at close to 20% right now—are clearly willing to lure the types of commercial uses that remain viable, while the lifestyle center concept as a whole shifts its focus away from shopping and more toward leisure and recreational spending. My suspicion is that lifestyle centers may be better aesthetically equipped than conventional enclosed malls for this consumer adaptation, thanks to their faux main street vernacular.
But they have to work overtime. The Promenade Shops at Saucon Valley is reasonably well designed, but the overall site selection is odd. Almost everyone I know who has visited remarks that it’s “in the middle of nowhere”. While incomes in the immediate area are quite high, it’s so sparsely populated that it defies the premise of “retail follows rooftops”. Income density is low. This lifestyle center is not visible from a major highway, despite the proximity of I-78. And the back of the lifestyle center is South Mountain, so there’s no chance of subsequent development improving the visibility from another angle.The entire premises only achieve visibility from motorists driving by on the south, and Center Valley Parkway isn’t a major arterial. This might explain why a particularly troubled storefront space, near the butt-end of everything, can’t secure a more lucrative tenant than a Subway.
And it’s not just any Subway—it’s a big one.
It’s common for Subway locations to seat no more than 20 people. This location looks like it has space for twice as many. Why so big? Subway franchises typically seek low-cost leasable space…which very well may be the case here.
Aside from morphing this lifestyle center into a dining, drinking and entertainment establishment—which might keep it going for a decade—I’m not sure how the Promenade Shops at Saucon Valley will fend off the same decline that at least four other malls across the region have faced. Heck, the Promenade Shops aren’t even pedestrianized, unlike many lifestyle centers. The murky future of these commercial campuses leads one to ask, “Are lifestyle centers really that special?” Are they sufficiently different from enclosed malls? Of course not: in fact, many of the earliest malls from the 1950 began as open-air districts that eventually became enclosed as people craved air condition in the hot summer months. Only in the 1990s did mall developers rediscover outdoor shopping, branding them as “lifestyle centers” no doubt with the intention of distinguishing them from malls…which the most prescient out there already predicted would fail.
I don’t think malls or lifestyle centers are going to face extinction. But I suspect they’ll have to fall a lot further before they enjoy any resurgence. Only when they become endangered—a novelty—will they perhaps trigger a nostalgia among elderly Gen Xers, who grew up on experiential shopping and may hope to recreate it. In the meantime, we at least get treated regularly to pictorial and video tours of our dead and dying retail palaces…all available on the Internet, the same digital infrastructure that has helped to undermine them in the first place.
22 thoughts on “Lifestyle centers: with Saucon Valley, neither lively nor stylish.”
Good article, Eric! Starting to worry about buying jeans (something I absolutely have to try on). Getting harder and harder as my go-to stores close one-by-one! Not jean related, but I do like Athleta at the Promenade Shops. The only reason I go there occasionally.
Thanks! I think that’s the main reason the high-end places are still doing fairly well; people don’t want to risk buying the wrong item online, especially if it costs so much. Also, high-end places tend to be more service-oriented, so that the clerks can actually recommend items or provide feedback on what is most suitable, fashion-wise, based on a person’s physique or preferences. So people still tend to patronize the expensive places, while the middle-class stuff is increasingly purchased via the web. Yeah, and it helps that the next closest Athleta is way down in KoP.
Two words Shayne-Nordstrom Rack!
Oh definitely! And Target! That’s why I said occasionally Athleta. Believe me, it’s not often I go to the Promenade
It should be noted that Greenwood is in the process of developing one of these “lifestyle centers”. The impact will likely be the devastation of Greenwood Park Mall. Being in my 60’s now I can recall when the mall was an “open air” affair too.
Thanks for your comment, Mark. I remember learning about that proposal over a year ago and feeling your frustration. It’s completely unnecessary and built on a mentality that says: “We’ve got the land, and it’s right by an interstate exit ramp, so why not built a bunch of retail?” It was all the more disappointing because the developer is currently involved in some excellent urban infill work in downtown.
However, you may take some comfort to learn that, according to a recent update by the IBJ (http://www.ibj.com/blogs/3-property-lines/post/62194-massive-90m-greenwood-retail-project-facing-delays) it looks like the project may not get off the ground, due to a lack of commitment from big-name retailers. Greenwood Park Mall may hang in there a while longer, unless of course the City of Greenwood helps subsidize infrastructure for a new, unnecessary new retail mega-project. Fingers crossed they’ll come up with some better use for the land.
Recall that Greenwood is part mall, part Lifestyle Center, part Big Box Power Center. Only the first two parts are under Simon ownership, I think, but the fact that the “Greater Greenwood Park” is a combination of all of them has agglomeration economies and survival advantages. Kohl’s and Best Buy and Bed Bath and Beyond are the Power Center tenants; Barnes and Noble, Cheesecake Factory, Bar Louie, BJ’s, and several apparel stores (including Carhartt) are in the “lifestyle” wing closest to the “main” entrance of the mall. No Burlington yet. 😉
Chris, I would imagine you’re right that the “Big Box Power Center” isn’t under Simon Ownership, and the the Greendale Centre immediately to the south of Fry Road almost definitely isn’t. I wrote several years ago about why the Greenwood Park Mall seems so strong when other malls are failing, and much of that probably still applies, though how much longer remains to be seen. I still can’t imagine what another major complex would be able to accommodate that the Greenwood area doesn’t already have (and that the market would support). And apparently I’m not the only one scratching my head; the retailers themselves can’t justify expanding either. When an experience-rich mega-retailer like Cabela’s struggles (exactly the sort of thing that should be flourishing, since it’s part merchandise and part amusement park), you know we’re in for some choppy waters in the future.
For the record, the Burlington Coat Factory is about a mile to the north, at U.S. 31 (East Street) and Stop 11 Road, in a building that once housed a Cub Foods, then sat vacant for at least five years before it became Burlington.
Maybe, if a new retail plaza opens at the place that Mark Johnson mentioned, it can get a Goodwill? Those seem to flourish about every 1-2 miles in the Indy metro.
I always looked at lifestyle centers as little more than gussied up strip malls. Traditional enclosed malls (even open-air ones like Old Orchard in Chicago) still had a pedestrian-only interior with basically blank walls to the surrounding parking lot. Of course there’s elements of both at lifestyle center, as well as a sprinkling of bastardized vaguely new urbanist design tropes that are mere surface dressing. Still, it comes across as something of a lipstick on a pig move to me.
I’m curious if you have an idea of how many lifestyle centers are decanted former malls. Beechmont Mall in Cincinnati was mostly dead around 2000, and losing its third anchor, Parisian was the final straw. They demolished everything except the two remaining anchors, Lazarus (Macy’s) and KMart, built a new Kroger at the Parisian site, and put a street through the middle where the inline stores used to be. Now it’s Anderson Towne (ugh) Center. No doubt there was a significant reduction in the number of tenants, but it updated the look of the whole site, and it seems to be holding on for the most part, sans KMart which is being redeveloped.
Thanks for your comments, Jeffrey. I don’t really know how many lifestyle centers are “decanted former malls”, as you describe, though I certainly like the term. What I’ve noticed is that many malls (particularly Simon-owned ones) have included a “lifestyle” component if one of the department stores remains vacant for long, yet the mall itself is successful. Others have recognized that their parking lot is bigger than it needs to be, and expanded a lifestyle “arm” onto those extra spaces, which is what happened at the Lehigh Valley Mall mentioned in this article.
Beyond that, most failed malls seem to get turned into something more akin to a power center, which I’ve covered in previous articles. The difference between a power center and life style center is a bit akin to ziti versus penne, but lifestyle centers still seem more aestheticized and less fundamentally car oriented. For example, the one above (Promenade Shops at Saucon Valley) is fully accessible by car, yet the focus remains pedestrian plazas, generous sidewalks, and safe crossings. Power centers have parking lots as their focal point.
When malls die, the land is probably not valuable enough to justify a highly designed approach for the solution, so Power Centers, which take little thought or design and become very successful for utilitarian shopping, generally seem to serve as the most predictable, least creative second life to a dead mall.
We’ve went to the Promenade frequently since it opened, but more for the entertainment based locations like the movies or dinner instead of going there to shop. Even now, my son’s friends love the Sweet & Sassy store, which is more an activity destination than a store. The only store we used to buy from often was LLBean, but after recently learning their stance on some social issues we plan to cut them out.
Thanks, Katie. Sounds about right…such is the way of things. These days, we all load up the car so the fam can go out and fave fun (food, movies, trampoline parks), but we shop while curled up under a blanket on our couch, iPad in our laps. In the future, I think more of the retailers are going to have to combine entertainment as part of their services, if they want to continue to sell items from a storefront space! In regards to your comments about LL Bean and the boycott, you might appreciate this satire from The Onion (if you haven’t seen it already): http://www.theonion.com/video/african-american-boycott-of-ll-bean-enters-80th-ye-14170
In your spare time, check out Main St. at Exton (US 30 at PA 100), Providence Town Center (US 422 at PA 29) and the region’s newest lifestyle center, the Village at Valley Forge (US 202 at North Gulph Rd.). Not sure how Main St. Exton is doing these days, and Providence probably has slightly lower vacancy rates than Saucon Valley, but Village at Valley Forge is still under construction and luring one-in-a-region upscale retailers. They all would be a good case study because they have the things Saucon Valley doesn’t – decent income density and visibility from highways. King of Prussia is still hot – as the mall goes, so goes the lifestyle center – but the other two would probably be better bellweathers on this retail typology.
Thanks Matt. I’ll have to look them up at some point. Your references to lifestyle centers in Philly begs the question: why did they choose such an obscure location for the Promenade Shops at Saucon Valley? I use the “middle of nowhere” phrase sparingly, but it really applies in this case. There aren’t other shopping centers nearby, which could be a positive (no competition) but just as much a negative (no agglomeration economies). The only other things along that stretch of Center Valley Parkway are some office buildings, most of which are newer than the Promenade Shops. We can only speculate that the land must have been cheap. The Promenade Shops actually has to advertise on billboards throughout the region–not something I see that much with other malls.
I’ve been watching Village at Valley Forge get built for the past few years of visits to the area.
Its anchors aren’t really “unique to the area” (Wegman’s and Walmart). Plus, it’s across the interstate from both KoP (destination shopping) and Lockheed Martin (high income workers), and surrounded by a massive highway junction…from which it has two of its own off-ramps. The residential areas nearest to it in Tredyffrin Twp. (just west and south) are some of the highest-income in the Philly area, served by one of the nation’s best public school systems. In short: no matter what retail goes there will probably succeed, if any retail survives the internet.
Love your work. As a curious observer of the evolving American landscape, can you recommend any other sites or Twitter feeds on the subject?
I appreciate your compliments, Kurt. I wish I could be of more help. As you might be able to tell, I’m kind of a maverick and don’t work much to promote my blog. I refuse to use Twitter. I do, however, have a Facebook page that simply announces my new posts, which you probably already know about: https://www.facebook.com/dirtamericana/
As for others like me, I’m sure they’re out there. But I don’t really ally with urban blogs, since there are a ton of them (and many of them are much better at it than I am). This is also a side project of mine, rather than a full-time job, so I don’t have as much time to network with the blogging community who post far more diligently than I do. Also, since I cover far more than urban settings and absolutely all of my blog postings are photo-based (though I’m also clearly not a professional photographer), I call my work “landscapes”. Tell you what: I’ll continue to meander along the Information Superhighway and will respond to this post again at a later point if I come up with some other good recommendations. In the meantime, I can and always will recommend the work of Aaron Renn (the Urbanophile).
Thanks!
Isn’t another factor that the United States is vastly over retailed on a per capita basis when compared to almost any other western or developed nation?
There is just too much, and people are jaded.
What is really depressing is to visit fundamentally stagnant Midwestern metros with no high land values or rigid planning regulations. The endless strips in my hometown of massive signs, absolutely cheapest possible commercial buildings and grass at best for landscaping is depressing. THIS is the light of the world, the bestest country in the world that builds cities that look like this? Drive along Coliseum Blvd (or Coldwater Road) in fort Wayne and tell me you don’t get depressed.
Yes, I believe you are right on the “over-retailed” aspect, except that you can remove the word. “almost”. We’re number one!
Thanks for your thoughts, Brian. As for the fundamentally stagnant areas in the Midwest, I can assure you that such constructions exist pretty much anywhere, and those “endless strips” that lack any real aesthetics were the status quo for the 1970s, when the emphasis was convenience and easily visible parking. In more economically robust areas, some strip malls have gotten upgraded to add better landscape/signage. But that’s not all that common…since, of course, it’s often cheaper and more effective to simply build a newer, nicer strip mall a few miles away, where all the money has started moving. We have a ridiculous short depreciation cycle for retail properties in the use, which goes hand-in-hand with the relentless oversupply. These days, even the places with weak zoning or design regulations typically still have some provisions requiring a minimum of grass islands in new parking lots, and even if they don’t have these provisions, the private market often takes care of it, because the newer strip mall developments find they HAVE to make some concessions to aesthetics if they’re going to be competitive and attract tenants.
I know, I know. Just got back from my hometown (Mom had to be relocated to assisted living) and I actually found some little islands of nice stuff in “The Old Fort” I could almost live downtown, now! (And, looking at my lack of cash, which means no money to reenter the hyper-inflated California real estate market, means the Midwest makes sense). But the outskirts…they are just so depressing!
The stuff way out southwest in the new money part of town does include one fancy Lifestyle Center that could fit right into a prosperous California or Texas suburb! So you are right.
The hideousness of 60s and 70s design is what inspired my professional choice (planning) and, despite my cynicism, I still have the aesthete’s reaction to Coldwater Road!
Thanks again for your comment, Brian, and sorry it took me awhile to respond. I know Fort Wayne reasonably well since I have family there, and I think I’m familiar with that lifestyle center you’re talking about. I visited about 5 years ago, and it didn’t seem to be doing that well: about the same as this Saucon Valley Promenade Shops. Maybe things have perked up.
I’d agree that there are many nice older areas to Fort Wayne, and while the 60s and 70s design is pretty bad from an urban form, at the very least the homes seem to be better built than the easy-credit vinyl villages of the 90s and 00s. Most homes built in the 70s are still holding their value and are in pretty good shape, though the streets leading to them probably lack sidewalks and curbs. I can’t help but wonder what many of the homes from the 2000s will look like when they’re 40 years old–I’m not optimistic they’ll be very attractive.