As anchors close, Southridge and other malls turn to less retail and more fun
As Southridge turns to a bowling / amusement venue to help fill its vacant Sears store, it follows a trend among U.S. malls: Less retail, more fun.
As anchors close, Southridge and other malls turn to less retail and more fun As Southridge turns to a bowling / amusement venue to help fill its vacant Sears store, it follows a trend among U.S. malls: Less retail, more fun. Check out this story on jsonline.com: https://jsonl.in/2FmgYSo
Rick Romell, Milwaukee Journal Sentinel Published 10:42 a.m. CT Jan. 27, 2018
Bowling is one of the activities offered by Round1, an entertainment company with plans to open at Southridge Mall.(Photo: BRIAN BARKLEY)
The bowling and amusement center planned for Southridge Mall not only stands to help fill the big hole left by the closing of Sears last fall; it also puts the Greendale shopping center squarely in the flow of a growing trend among malls nationwide.
With the shuttering of hundreds of department stores, many of them anchors that once drove traffic both for themselves and other retailers, malls are seeking new ways to pull people in the doors.
And increasingly, they are looking at entertainment and dining tenants as prime options. CoStar Group Inc., a commercial real estate information firm, says regional and super-regional malls now devote 9% of their occupied space to entertainment and dining tenants, up from 7.9% five years ago.
Like Milwaukee Journal Sentinel Business on Facebook for the latest updates right in your news feed.
Visit JS Business on Facebook
That sounds like a tiny increase — until you consider that the malls CoStar tracks collectively cover 1.1 billion square feet, which suggests that more than 10 million square feet have been given over to entertainment since 2012.
"Obviously, there aren't a lot of department stores expanding right now, so the idea to backfill these empty spaces with another department store is a long shot," Chicago-based retail real estate consultant John Melaniphy said. "So the developers and real estate investment trusts have been turning to entertainment venues."
Which, in the view of Melaniphy and other industry observers, is a smart idea — one some say could rekindle the status of malls as destinations.
"That's where (malls) started from," said Paula Rosenblum, co-founder and managing partner at retail consultant RSR Research. "And they just got lazy."
Now, with routine shopping moving online, mall owners across the country increasingly want to again position their centers as places where people don't just go to buy stuff, but to do things and have fun.
"They're trying to re-infuse an experiential aspect to the mall to draw traffic, because that's their job," Rosenblum said. "When push comes to shove, the mall operators' job is — period, full stop — to drive traffic to the mall. That's the whole purpose."
Dick Seesel, owner of Mequon-based consulting firm Retailing in Focus, said entertainment and dining options not only can generate more foot traffic, but can keep people at the mall longer — benefiting traditional stores.
"There's a lot of evidence that the longer the visit, the more likely some shopping is going to take place," he said.
By changing their tech and branding, malls are growing up along with us. Aidan Kelley has the story. Buzz60
So Great Lakes Crossing Outlets, near Detroit, has added a Legoland Discovery Center and an aquarium.
Circle Centre Mall in downtown Indianapolis has leased space to a bowling alley / restaurant / arcade concept called Punch Bowl Social, and to a glow-in-the-dark mini-golf attraction.
The Florida Mall in Orlando has put in a 70,000-square-foot Crayola Experience amusement center for kids and families.
And Easton Town Center, in Columbus, Ohio, now boasts 24 full-service restaurants, with dining options ranging from Turkish to sushi to Tex-Mex to Mongolian to Brazilian to an Irish-owned Irish pub.
In Wisconsin, a Dave & Buster's restaurant-arcade-sports bar will take over space in the downsized Sears store at Madison's West Towne Mall in April.
Brookfield Square is contemplating a theater / restaurant complex and a tavern featuring bumper cars, laser tag and bowling.
It's a good bet the redevelopment of Glendale's Bayshore Town Center, which already has several full-service restaurants, a movie theater and a small bowling alley, will include more dining or entertainment options.
And Southridge is poised to add Round1, an amusement center and bar with bowling, karaoke, billiards, ping pong and more than 200 arcade games.
Among new tenants planned for the now-vacant Sears department store at Southridge Mall in Greendale is Round1, an outlet of a Japan-based bowling alley / arcade chain that has been growing in the U.S. as shopping centers increasingly look to entertainment and restaurant tenants as retail anchors close. (Photo: Paul Gores / Milwaukee Journal Sentinel)
Greendale village officials have said Round1 will take 45,000 square feet of the former Sears store. The amusement center will occupy the upper level, with an entrance facing the inside of the mall, village manager Todd Michaels said. Dick's Sporting Goods will move into the lower level of the former Sears.
Melaniphy thinks Round1 will be a good fit for Southridge, attracting millennials who, the conventional wisdom says, value experiences over things.
"They are absolutely looking at experiences," he said. "They are eating out more frequently, patronizing entertainment venues. Their spending patterns are much different (from their parents)."
Could bowling alleys and arcades in malls pose significant problems with rowdyism? Rosenblum, for one, doesn't think so. Adequate security should be able to control any issues, she said.
In any event, the wave of department-store closings — more than 400 have been announced since 2016 by Macy's, Sears, J.C. Penney and Bon-Ton alone — has opened a door for companies like Round One Corp.
Based in Japan, Round One came to the United States in 2010. It now operates 19 amusement centers here — all of them in shopping malls — and has several more in development.
Round One Corp. originated in 1980 and has more than 100 stores around the world. (Photo: BRIAN BARKLEY)
"It sounds like they have an opportunity, depending on how ambitious they want to be opening stores, because there are certainly going to be a lot more mall anchor locations opening up," Seesel said.
Round One does indeed see opportunity in America's wave of department-store vacancies. The company operates more than 100 entertainment centers in Japan and is looking to have that many here too, U.S. marketing manager Taka Mizuno said.
The chain expects to field nearly 30 U.S. locations by the end of 2018, and hopes to add seven or eight a year, he said.
Melaniphy believes shopping center owners are subsidizing new entertainment venues and restaurants "as a loss leader to bring that millennial consumer to the mall." The financial help, he said, can come in the form of low rent or by covering the often-substantial costs to convert retail shells into bowling alleys, restaurant kitchens and such.
In the case of Southridge, there could be public assistance too. It's likely the village will use tax incremental financing to help the owner of the Sears store, Seritage Growth Properties, pay for the build-out required for Dick's and Round1, Michaels said.
Brookfield, meanwhile, is considering providing $6.2 million toward replacing the Brookfield Square Sears, with the money to be recouped from property taxes on the new development.
Redevelopment plans for Bayshore's northern end, site of an empty Sports Authority store and a now-leveled Sears, are still in the works.
RELATED: Dick's Sporting Goods, 3 other stores coming to closed Sears at Southridge in Greendale
RELATED: Brookfield Square redevelopment could include restaurant and tavern with bumper cars
RELATED: Glendale's Bayshore Town Center has new owner as redevelopment continues at former Sears site
But Kirk Williams, a managing director of Cypress Equities, the Dallas-based firm hired to help operate Bayshore, considers dining and entertainment important elements in a shopping center mix. He speaks enthusiastically about communal spaces filling basic human needs that run deeper than the itch simply to buy stuff.
"How buildings relate to the human desire to belong and connect — that'll dictate success," he said.
Williams can sound like a sort-of developer-philosopher with a soft Texas drawl, but other mall operators, while less abstract, strike the same basic notes.
"Consumer preferences have changed," said Stacey Keating, spokeswoman for Brookfield Square and West Towne owner CBL Properties, which now is focusing less on traditional retail at its malls and more on dining, entertainment and wellness.
"People are spending more money on experiences, they're spending more money on dining out, and we want to be able to cater to what our customers are looking for," she said.
Round1 has bowling, billiards, ping pong, darts, arcade games and karaoke in its facilities, which typically are 50,000 square feet and occupy spaces in malls as anchor tenants. (Photo: BRIAN BARKLEY)
Top Headlines from Business:
Subscriber exclusive: Brookfield Square is adding fun and fitness to food and fashion to attract people to the struggling mall
Subscriber exclusive: New Wisconsin program focuses on finding better jobs for spouses of Guard members and Reserves
2020 Democratic National Convention information sessions planned for Milwaukee businesses, musicians
FOLLOW JS BUSINESS: Facebook | Twitter | LinkedIn
Be MKE
Who we are. Where we go. What we need to know.
Each week in this newsletter, Sarah Hauer will serve as your city guide and share stories about Milwaukee, its people and what's happening around town.
Read or Share this story: https://jsonl.in/2FmgYSo
Born after 1989? You need safety certification to drive a boat
Proposed downtown timber office building redesigned
5 things to know about boating laws in Wisconsin
Walmart starts free, next-day delivery in Wisconsin
Brookfield Square adding fun and fitness to food and fashion
Foxconn says factory production still will begin in late 2020