Across Missouri and around the country, shopping malls are struggling and many are shutting down. Crestwood Court, considered St. Louis’ first enclosed mall with multiple anchors, closed last year after 56 years in operation. Kansas City’s Metro North Shopping Center, which opened in 1976, closed in April.
Green Street Advisors, a real estate analytics company, issued a report at the beginning of the year that predicted about 15 percent of U.S. malls will fail or convert to non-retail space over the next decade, according to Business Insider. Some retail analysts predict a more expansive demise.
But in Columbia, the city’s first mall is experiencing a revival. Managing Director Ben Gakinya has turned Parkade Center into a corporate campus by appealing to local businesses, redecorating the property, bringing in a community college and generating foot traffic with events — such as trade shows, weddings and barbeque cook-offs.
Parkade Center opened in 1965 on a cross-state highway replaced by Interstate 70, and for awhile it was the premier shopping destination in mid-Missouri. Its anchor store was JC Penney.
In 1985, a much larger mall in Columbia opened, and Parkade began to struggle. JC Penney eventually was replaced by the U.S. Department of Agriculture, which still occupies the space.
But throughout the 1990s, the mall had an uncertain future. Gakinya said there was a time when the center was at a 33 percent occupancy rate, measured in square footage. In the mid-2000s, a local family purchased Parkade and hired Gakinya as leasing manager.
Gakinya became managing director of the mall and its events in 2008. At that time, Parkade’s occupancy rate was 77 percent. Today, it’s 96 percent, Gakinya said. Key tenants include a Moberly Area Community College campus, Harbor Freight Tools, a Boone Convenient Care clinic and a mix of small businesses, such as restaurants, barbers and local retail stores.
Lloyd Hayes has operated a barbershop, All Star Cuts, in Parkade for the past nine years and has witnessed the transformation.
“When I first came, it was pretty dead,” Hayes said. “There was a different management then, but when Ben came, it seemed like it started slowly, gradually growing different businesses.”
Gakinya said Parkade is thriving because he works closely with potential tenants to understand what kind of space they want. Then, Gakinya tailors the improvements to meet their wishes.
“It’s easier,” he pointed out, “if you can deliver the product to the tenant to make the deal happen than opposed to them taking it on and doing it themselves.”
Gakinya said some of the tenants were initially hesitant about coming to Parkade because of the layout of the mall, which has a ground floor and a below-ground floor, but he’s found ways to address those concerns.
“They want to have sunshine because on the lower level unfortunately we don’t have any direct sunlight,” Gakinya said. “But we’ve done things to kind of combat those concerns and one of them is our lighting in the lower level. It actually has a daylight brightness.”
He has also painted parts of the building with brighter colors, decorated the walls with local artists’ work and brought in a gardener to maintain live greenery throughout the building. Beyond aesthetic improvements, Gakinya said an important part of Parkade’s revival was turning the mall into a multi-purpose space with plenty of foot traffic. This is achieved by hosting events at the center, such as the Columbia Farmers Market, which allows area farmers to sell their goods during the winter months.
Gakinya said, “Tenants love it because the more people that come to the building, then they realize, ‘Oh my gosh, I didn’t realize this store was here.’ Now, they’ve got a new customer.”
Music store owner Bill Barnhouse said he formed a business relationship with Gakinya before he found out that the building he leased downtown was going to be torn down to make room for college student housing.
“I did a little sound show here for a charity auction event and got a good look at the place finally,” Barnhouse said. “We were also being forced to move so it all coincided real neatly.”
He liked what he saw, and Barnhouse’s Crazy Music Store reopened at Parkade Center in January.
Gakinya said having the community college at Parkade has also contributed to a livelier atmosphere.
“As a result of the school expanding on the lower level, we expanded and added more retail space and office space,” he said. “You have little cliques of study sessions going on, so that’s great to see the space being used in ways like that.”
While on break from class one evening, MACC student Brittany Keith, peered at the storefront of Karma Care, which has a sign in the window advertising its holistic counseling services. “I mainly just explore when we’re on breaks, and I just think all the shops are pretty cool,” she said.
Gakinya said he hopes to bring more events to the center through the Plaza Event Center, which targets business meetings, corporate events and weddings. He hired an events coordinator last year to help manage the planning process.
For weddings, the main level of the mall is transformed into a banquet hall with long curtains lining the walls to block out storefront windows and doors. Parkade has hosted about 16 weddings in the past year, but Gakinya said his goal is to have one every weekend.
Malls hurt by online competition, enclosed atmosphere
Redeveloping mall business models or repurposing mall space is becoming an imperative for older shopping centers across the country. More shoppers making purchases online and the architecture of enclosed malls is becoming less appealing, so malls must adapt to the shift in shopping patterns among consumers to stay viable, business professors at the University of Missouri said.
“The whole idea of the mall was shutting out the outdoors and now people are sort of wanting the outdoors,” said Peter Bloch, a professor of marketing at MU who has researched consumer behavior in shopping malls. “So much of the mall development now is going to be more outdoor-focused.”
Revitalized malls also have a better chance of succeeding if they are located in healthy economies without an oversaturated retail market, Bloch said.
“There’s places, in some of the rust belt malls, that are just in some really declining areas of town, and they’re just going to be demolished I imagine,” he said.
Green Street Advisors said malls with high productivity and the ability to attract new stores when leases expire could see several years of solid net operating income growth.
“It boils down to the mall, the local economy, who the owners are and if they are financially in good shape that they can reinvest and reinvigorate the property,” said Donald Meyer, an assistant professor who teaches retail marketing at the University of Missouri.
The Columbia Mall, now nearly 30 years old, is still bringing in new stores as leases expire. It opened an H&M in September, and is preparing to open a Charming Charlie later this year.
Meyer said the vitality of shopping centers like Parkade and the Columbia Mall is also a reflection of Columbia’s recovery from the financial crisis that occurred in 2008. The city continues to grow about 2 percent every year and has the state’s lowest metropolitan unemployment rate for years.
But as for repurposing “dead” malls, the professors said success depends on the local economy and if developers can reposition the mall to offer something that doesn’t have to compete with a saturated retail climate.
“There are malls that are using the space, which is perfectly usable — you’ve got great parking, you’ve got great access — and they’re putting in art museums and amphitheaters and community colleges and libraries and job training centers,” Meyer said.
Bloch added, “If the whole area has gone down and they’re just kind of caught up in the downdraft of that, then they’re not going to be able to repurpose it. Unless maybe if the city puts in flu clinics or something.”
Gakinya said because he’s targeted certain types of businesses that fit Parkade’s new, revised model, he no longer considers the Columbia Mall direct competition.
“We’re totally different beasts,” he said.