Shopping malls are undergoing a significant transformation as they incorporate hotels, sports fields, and offices, leading owners to consider rebranding. Eastland, a shopping mall near Melbourne, Australia, offers more than just the traditional shopping and dining experience. It now includes offices, a hotel, and entertainment options like a bowling alley with karaoke and escape rooms.
This trend of mixed-use developments has become the focal point for many new malls. The COVID-19 pandemic and the rise of hybrid working have reshaped consumer behavior, with people spending more time at home offices and shopping locally. Consequently, "mixed use" is now seen as the most effective way to utilize mall assets. At the Malls of the Future Summit in Sydney, industry experts discussed how to incorporate and build on synergies in co-working spaces, offices, hotels, childcare facilities, and medical services.
The evolving nature of these developments raises the question of whether they should still be called shopping centers or malls. Sarah Blackmore, Head of Asset Management at Sandhurst Retail and Logistics, revealed that they are currently deciding how to brand their latest projects, as they bear little resemblance to traditional malls. These modern developments offer far more than just shopping, featuring open-air amphitheaters, courtyards, and sports facilities. The focus is on designing buildings for the future and providing customers with compelling reasons to visit.
Interestingly, the significant growth of e-commerce during the pandemic, once considered a threat to brick-and-mortar retail, is now shaping the future of the industry. The convenience of e-commerce, including services like curbside pickup, has changed consumer behavior, particularly among Gen Y. Curb-side pickup allows customers to save time, giving them more leisurely opportunities to explore stores instead of rushing through supermarket aisles. This flexibility is precisely what customers desire, creating a superior shopping experience and allowing them to spend more time in malls.
Attracting customers back to shopping centers is a multifaceted challenge. Developers and landlords must create spaces that people want to visit, curate the right mix of tenants, and offer engaging experiences such as sports events and fine dining. According to JLL's 2023 Retail Grocery Outlook, the momentum in retail has shifted toward dining out, with restaurant sales surpassing grocery spending in 2022. To entice customers, malls are embracing the trend of increased dining experiences, acknowledging that entertainment and dining are key factors in attracting visitors.
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