JC Penney and Sears were both gutted by their corporate leadership, who stole the family silver and moved on. What's left is the parts that couldn't make money. They've been on the brink of BR for years and years. When they go, a lot of legacy type mall space will be shuttered. That I do believe.
What I don't see is shameless commerce grinding to a halt. All the Medicaid kids in my practice are still buying their Air Jordans somewhere.
Sites like ZH have been crying doom over mall closures for the whole time I've been reading their shit, which is more than five years now. It's not that malls are doing great, it's that the changes in retail are complex and multi-facted, and hard to parse out. I put a lot of the blame on the LBO boys sucking the juice out of these companies through various restructuring deals. It's a vampire squid problem, not just the end of commerce in general.
Is it healthy? No. Does it portend collapse? Yes. But is it as bad as JHK would like to believe? Not nearly. Is it as bad as you think it is? No. At least not yet. Gonna have to hang in there for a while if you want to see JIT commerce lock up from credit collapse.
I'm mostly with Eddie on this one; obviously people are still buying stuff, just not so much by driving to the mall. It's as much a demographic/sociological shift than a product of collapse.
* Sears Roebuck and Montgomery Wards, along with some lesser names, built their brands on mail order via catalogs distributed by the Postal Service. What kind of TEOTWAWKI hysterics took place when all those folks -- folks that had lived their lives within walking distance of their home -- that now had cars and could drive to those shiny indoor shopping circusses (malls) to actually
look at the products before paying for them
quit ordering from the catalogs? Oh the horrors! What's to become of our lucrative mail order business? The ones that couldn't afford to proliferate into brick and mortar no longer exist. My dad, a farmer, thought it was
great that he could drive to Sears for a new Craftsman tool when he needed it rather than wait two weeks for it to come in the mail.
*Ahem! That is not to deny that we are in a shrinking economy, that collapse is contributing to the demise of many old business models. It's just that, as Eddie points out, there are other factors in play here, including the continuing pervasiveness of the car culture. I have read on occassion that studies into the failing of malls reveal a couple interesting details.
1) In recent decades malls became the hang out of the teenage population, causing older buyers, the ones who actually spent real money, to find the environment repugnant.
2) Those same older buyers got older, fatter, lazier and, other than those that used mall hallways as an indoor exercise arena, increasingly refused to walk the ridiculous distance from the parking hinterlands to the destination store; they wanted to enter the store from the outside.
This has lead to the current trend in mall restructuring where all stores are directly accessible from an outdoor entrance so that the slobs can park in the handicap space and shuffle their fat ass inside. Both of the malls in the city near me have done this. The older one converted into a row of big-ish box stores with separate entrances; a Whole Foods is one of them, Office Depot another, etc. The other larger newer mall tore down 80% of the old 'hallway with little stores on both sides' and built entirely new freestanding buildings for Nordstroms, etc. No more 20 acre parking lot; instead it's lots of smaller lots with buildings in the middle of them.
Time will tell whether this proves effective for them. It strikes me as a desparate grasping for the glory days of profitable retailing without recognizing that a relentlessly contracting economy means a permanent slide toward failure, however slowly it occurs.
Which brings me to another point I want to direct toward Eddie: you, in Austin, and me, on the Colorado front range, live in pockets of relative prosperity when compared to most of the nation. It's easy for us to take for granted that our geographical locations are typical, but they decidedly are not. I come from a VERY large family, have connections all over the country. The stories I hear tell me that most other areas are showing the symptoms of contraction and collapse far more visibly than out here. Visitors marvel at our area's lack of trashed out neighborhoods, empty dilapidated manufacturing facilities, un-maintained roads, etc.
The thriving old-town districts with no skid row around the corner, nice brew-pubs and night life have them talking about moving back. BUT, the same profession here pays half what it does in Atlanta, or even Dayton which is in many ways a cousin to Detroit. People are willing to live here for the "quality of life" even though the mean wage level is significantly lower. Again, the relative prosperity here is a fluke, not exemplary of most of the country.
--Greg
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