A New Look at the Mall

Two recent news items may just provide a clue for those who have a little money to invest and are wondering where best to put it for maximum return.
Hot off Reuter’s wires comes the news that, in February, US permits for housing rebounded from record lows, showing a rise for the first time in ten months and “bringing a glimmer of hope for the recession-hit economy”. The second item comes from Time magazine. In an article entitled ‘Recycling the Suburbs’ author Bryan Walsh points out that “the American suburb as we know it is dying.” Thanks to the housing bust, which has hit the suburbs hardest; changing demographics (more empty nesters, fewer households with children); and a growing preference for living close to urban amenities (underpinned by rising oil prices and increased consciousness about the environment), the face of once-thriving suburbs is changing. There is a growing surplus of large-lot homes – and the malls that fed the old consumer-driven economy are falling empty.
Enter developers and those with an eye to the future, as empty malls are remade. For example, in Denton, Texas, the old Food Lion supermarket has become a new public library. In Austin, Minnesota, a Kmart that was surplus to requirements is now a museum. And in Boca Raton, Florida, an ‘old’ shopping mall has become a mixed-use town center. It is this latter notion that those with some money to invest might gainfully utilise. Because people are happy to live in the center of it all, it makes sense to buy spaces in boarded-up malls – and turn them into apartments. The infrastructure is there and a move to redirecting development towards it has already begun.
Walsh points out communities as far apart as Colorado and California that are creating mixed-use developments out of unused malls, turning them into apartments, offices and small retail outlets. It’s known as “recycling underperforming asphalt.” In this way new urban centers are forming – new ‘downtowns’ – places with a heart, where you do not need to get into your car to go buy a loaf of bread. Walsh quotes co-author of ‘Retrofitting the Suburbs’, Ellen Dunham-Jones, who says, “All of these projects are developer-driven, because the market wants them.” Which is the main point for the small investor, who is looking for what the market wants, in an economy that is just starting to show a glimmer of hope.
The best place to begin to look for that unused mall is in the older, inner suburbs. In these areas there is the concentration of people likely to flock to a new development that offers good public spaces, proximity to amenities, and the ability to keep your car in your garage and quit mowing lawns. However, cheaper property is likely to be found further out – it all depends on whether you want to embrace the risk of the venture not catching fire for a while, as people come to realize the value of re-using existing structures rather than eating up more land and resources in brand-new developments.
It is possible this clean, green, lateral way of thinking will catch on quickly.

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