Shopping districts’ next step
Move toward open air, mixed uses, varied anchors predated COVID
The traditional American mall has long been evolving, and regional centers have been catching on. Some shopping centers have already adapted by including necessary elements — open-air sections, economy-flexible anchor tenants, and mixed-use designs — while others have plans on the drawing table.
Redevelopments of shopping centers in and around Boulder have reimagined the mall that became a familiar part of Americana: an enclosed structure with hundreds of merchants and big chain department stores. A center that’s almost entirely retail with maybe a food court and a movie theater, is changing fast.
The now 4-year-old redevelopment of Longmont’s Twin Peaks Mall into The Village at the Peaks’ open-air and mixeduse layout has helped protect it from financial hardship during the COVID-19 pandemic. Proposed developments for parts of Flatiron Crossing are on the table, and Boulder’s Twenty Ninth Street reuse of Macy’s is gaining momentum.
Though a mall can be a onestop destination to knock out a shopping list, diversifying its business model is a way to compete with online vendors.
Consumer trends of online shopping have been exacerbated by the pandemic, according to Stephanie Cegielski, vice president of public relations for the International Council of Shopping Centers.
“Prior to the pandemic, about 10% of all retail sales occurred online. That number increased significantly during the pandemic since it was one of the only ways people could shop or felt comfortable shopping during the shutdown,” she said in a statement.
The trade association represents a network of 70,000 shopping centers around the world. It was established in 1957, one year after the first American mall, Southdale Center in Minnesota, opened.
In a June letter to all members of the U.S. Senate urging more government support for American malls, ISCS President Tom Mcgee wrote that “the shopping center industry is one of the most distressed industry sectors impacted by COVID-19.”
He added that some tenants stopped paying contractually obligated rent, resulting in an estimated $35 billion unpaid in April and May. Mcgee wrote that 12 million shopping center-related jobs have been lost.
Some U.S. properties that have seen success during the pandemic are anchored by grocery stores or other essential businesses, Cegielski said.
Anchor tenants
For shopping centers in Newmark Merrill Mountain States LLC’S portfolio, grocery stores and restaurants offering fast-casual service have performed well during the pandemic, said Danaria Mccoy, vice president of operations for The Village at the Peaks. NewMark Merrill is the developer and landlord of the Longmont shopping district.
One of the first anchor tenants to sign on to the project — a redevelopment of Twin
Peaks Mall — in 2016 was Whole Foods Market Inc. The natural-food chain declined to disclose revenues at the shopping center or for the company. Its parent organization Amazon.com Inc. net sales increased by 40% in its second quarter compared to the $63.4 billion made in 2019, according to a financial report in July. Amazon reported that its online grocery sales tripled in its second quarter. It also owns Amazon Fresh, a grocery delivery service.
Other Village at the Peaks tenants that continued operations include Sam’s Club, Wyatt’s Wines and Spirits, Bellco Credit Union and 10 restaurants. Village at the Peaks recently added a Bank of America branch. It also broke ground on a Raising Cane’s Chicken Fingers last month.
“We are happy to have
Whole Foods. We’re happy to have Sam’s Club, Wyatt’s, these are businesses that have been serving the community throughout COVID,” Mccoy said. “But then we also have all sorts of wonderful restaurants who have developed curbside programs and outdoor dining programs that can operate currently at a reduced occupancy.”
She considers Village at the Peaks to be a community center where locals can find their daily needs.
Thanks to its essential business merchants, sales-tax revenue generated by the property has increased during the economic downturn. Jim Golden, chief financial officer for the city of Longmont, said sales-tax collections are up 17.1% as of August over the same eightmonth period in 2019.
Mccoy said that Newmark Merrill worked with tenants on accessing government assistance, and where to source masks and sanitizer. It helped with marketing and updating