Once a dominant feature of American life, shopping malls have experienced a steady decline over the past decades as shoppers shifted away from big box stores in favor of e-commerce.
In the United States, many shopping malls have closed in recent years and more than hundreds are expected to close in the coming years, according to real estate research companies. Yet Albuquerque has resisted this trend somewhat with several city malls adding new tenants and pursuing new construction – even during the pandemic.
Local property experts and mall managers have the ability to adapt credit and the ability to focus on the needs of consumers.
Ben Perich, vice president of Colliers’ retail team in New Mexico, said some of Albuquerque’s malls have adapted to the changing shopping scene by diversifying their offerings and expanding moving away from the traditional environment of indoor shopping malls.
While there is an abandonment of indoor malls, Perich said he doesn’t think the format will go away altogether, there will just be less need of it.
“We are nearing the end of the large closed indoor mall,” Perich said. “… I think a lot of this has to do with changing buying trends, thanks in large part to the Internet. “
Perich said the trend is already playing out in Albuquerque – Midtown’s Coronado Center is almost full while he said his interior counterpart, Cottonwood Mall on the West Side, is struggling to attract and retain tenants.
Cottonwood Mall management did not respond to interview requests.
In the past five years, the mall has lost two key tenants when Sports Authority and Sears filed for bankruptcy in 2016 and 2018, respectively, and closed their Cottonwood stores. The loss of primary tenants has resulted in more than 100,000 square feet of space available for rent or purchase, according to listings from the Commercial Association of Realtors New Mexico.
Washington Prime Group, owner of Cottonwood Mall, also filed for bankruptcy this year.
“It’s probably not fair to call Cottonwood a corpse right now,” Perich said. “… If JCPenney closes, if Dillard closes, then it’s definitely a dead mall.”
Perich said the different results are in part due to Coronado embracing non-traditional mall tenants as entertainment options and Cottonwood having to contend with a nearby mall full of department stores like Costco and Cost Plus. World Market.
“(Cottonwood) itself needs to be redesigned with a variety of additional uses,” he said.
Perich said that in the future, he believes there will be a continued evolution towards a “downtown” design, much like the already existing ABQ Uptown mall in Louisiana and the Indian school.
Across the country, many malls are already starting to follow the downtown or outdoor mall plan of higher dining ratios, more outdoor events, and a move to a live workspace, a he declared.
Perich said the shift to an outdoor mall started around the 2000s, and there has recently been a trend towards adding health and wellness components like gyms and doctor’s offices.
“I would say that we are 20 years into this evolving trend and there is really no evidence that that is going to change,” Perich said. “… it’s just about becoming a little more of a liveable and passable environment because that’s what people want. “
The future of Winrock
Much like ABQ Uptown, which Perich cited as an example of a retail environment that first brought a mixed-use design to Albuquerque and embraced the concept, Winrock Town Center is emerging as a destination hub. via a live-work-play design.
When Winrock first opened in the 1960s as an indoor mall, it was the state’s leading shopping destination, according to Scott Goodman, vice president of Goodman Realty, owner of the mall. By the mid-2000s, however – when Goodman Realty bought the center – Winrock was “dying,” Goodman said.
Since purchasing the center, Goodman Realty has converted the existing big box stores on the property into new businesses, such as turning the old Toys “R” Us into a Chuze Fitness gym while adding a variety of retailers with exterior access such as Ulta Beauty, TJ Maxx and Nordstrom Rack.
Goodman Realty is currently in the process of converting the mall’s main structure from an indoor mall to a mixed-use outdoor mall with a park in the center.
Plans for the center go beyond retail stores and restaurants.
Over the next several years, Goodman Realty will add condos, lofts, hotel and office buildings to the property.
The center is also largely moving away from anchor department stores in favor of larger medical practices like New Mexico Orthopedics and smaller retail spaces, according to Goodman.
Goodman said the investment in Winrock through the redevelopment has been able to create demand for the center, which he says will continue as the mall continues to add more mixed-use components.
Even the Coronado Center, a solid indoor mall, took a more mixed-use design by incorporating lifestyle tenants like Round One Entertainment into the old Gordmans space and bringing more dining options to life.
Coronado chief executive Randy Sanchez said the mall intentionally decided to add more restaurants and experience-based businesses over the past decade in an effort to remain relevant to consumers.
Sanchez, who worked at Coronado for nearly three decades, said that over the past decade the mall has undergone multimillion-dollar renovations as it moved away from retail.
Sanchez said these investments and the addition of tenants based on market research have allowed the mall to continue to be successful.
Coronado is owned and managed by New York-based Brookfield Properties and currently has a 98% rental rate.
Some of the more notable changes include the addition of a few large footprint stores like H&M and Forever 21, while downsizing the main tenant Sears and using the extra space to attract more retailers. Sanchez said the rebuilding of Sears allowed the mall to acquire an additional 100,000 square feet of rental space and add a handful of externally formatted stores like The Container Store, Rusty Taco and Blaze Pizza.
About eight retailers were also added inside the mall with the Sears renovation.
Part of the reinvention of Coronado also involves adding restaurants rather than just the food court.
Just 10 years ago, the only restaurant in the mall was Fuddruckers, Sanchez said, but now the lineup includes national channels like The Cheesecake Factory and, more recently, upscale Brazilian steakhouse Fogo de Chão.
“They are all doing well,” he said. “We love to eat here in Albuquerque.”
Sanchez said he expects the next decade to be filled with changes for the center and that he could imagine the property becoming denser and adding a more mixed-use approach similar to that of his neighbor, Winrock.
“The Coronado Center is the big gorilla, if you will, for shopping in the state of New Mexico and we want to continue to be,” he said.