The Surprising Revival of Malls Is About More Than 'Intense Nostalgia' — 3 Factors Are Behind the Resurgence, According to a New Report Malls experienced an 11% surge in sales last year, reaching $819 billion in 2022.
By Madeline Garfinkle •
Key Takeaways
- Malls surged with an 11% sales leap, hitting $819 billion in 2022 and debunking predictions of decline.
- Affluent-area "top-tier" malls thrived, boasting 12% traffic growth, while "low-tier" malls continue to face closure but still had a traffic increase of 10% last year.
Opinions expressed by Entrepreneur contributors are their own.
Despite some experts' warning of the dwindling presence of malls due to overdevelopment and ecommerce competition, new research proves those warnings wrong.
According to a new report from Coresight Research, sales at malls jumped more than 11% to $819 billion from 2021 to 2022.
"Dying shopping malls are points of cultural fascination in the U.S., and content on the death of the American mall generates intense nostalgia among Americans who grew up enjoying these cultural destinations," the researchers wrote in the report. "Yet the picture is nuanced, and top-tier American malls are outperforming."
The firm defines "top-tier" malls as being located in affluent areas where the average shopper makes more than $200,000 a year. "Low-tier" malls are marked by declining sales and have a less affluent demographic on average. Still, even lower-tier malls experienced 10% traffic growth in 2022 as compared to pre-pandemic levels in 2019, while top-tier malls had a 12% traffic increase, according to the report.
However, the presence of malls is still shrinking. According to the International Council of Shopping Centers (ICSC), in 2023, retail malls accounted for 5.5% of leasable brick-and-mortar areas, down from 5.7% in 2014. Researchers attribute the decline mostly to the closure of low-tier malls, which have been steadily closing since before the pandemic, per Coresight.
Farmers market in the atrium of Aventura Mall in Miami, Florida. Jeffrey Greenberg | Universal Images | Getty Images.
Top-tier malls had 95.1% occupancy in 2022, still behind pre-pandemic levels (95.5% in 2019), but far less so than low-tier malls, which had 89.1% occupancy compared to 91.6% in 2019.
"Occupancy rates are the No. 1 indicator of a mall's health," Deborah Weinswig, CEO of Coresight, told CNN.
Coresight says the three main factors contributing to the growth are a "halo effect" (where malls have a presence both online and offline, reinforcing each other and subsequently boosting sales); brand synergy; and investing in the customer experience through renovations and partnerships with technology providers to enhance the shopping experience.
The enduring appeal of malls could also be attributed to a more psychological element, as the hubs serve as "third places" — community centers outside of home and work — and can instill a sense of nostalgia, PureWow reported in June.
Related: Airbnb Renter Finds 'Haunted' Abandoned Shopping Mall Beneath Her Unit
