Mall shoppers can expect to find fewer places to buy clothes and more office and medical tenants in the coming years.
CBL Properties, the largest mall owner in the St. Louis region, announced a new initiative at the end of October to combat falling occupancy rates: a plan to attract medical and other office tenants to its sprawling mall properties.
The move comes as retail bankruptcies, store closures and rent concessions are putting pressure on mall owners. The Limited women’s apparel retailer, for example, closed all 250 of its stores nationwide this year, including five in St. Louis.
CBL’s revenue fell in its most recent quarter due to “higher than expected retail bankruptcies, lower rent from lease restructures for bankruptcy reorganizations and pressure on renewals with certain other retailers, and slower temporary and permanent leasing for spaces vacated by bankruptcies,” Wells Fargo Securities senior analyst Jeffrey Donnelly wrote in a recent research note.
In response, Chattanooga, Tenn.-based CBL just created a new executive position, vice president of mixed use, to focus on adding medical and other types of office users across the portfolio. CBL owns 76 enclosed, outlet and open-air retail centers nationwide, including West County Center, South County Center, Mid Rivers Mall and St. Clair Square in the St. Louis area.
While St. Louis isn’t among markets CBL identified as having an immediate opportunity for medical office or mixed use, the company’s change in strategy could eventually affect its properties in the area.
Read more: St. Louis Post-Dispatch