Malls in America have struggled to keep business up since before the recession. They’ve faced competition from online retailers and haven’t found a solution to the loss of big box anchor stores who found they could no longer sustain the square footage they once did. It’s not hard to find an analyst trumpeting the death of the mall as developers look for alternatives.
Rick Caruso, CEO of Caruso Affiliated thinks he has it figured out.
“The most productive retailers and restaurateurs are all on streets, anywhere in the world. There isn’t a mall in New York City that does better than Madison Avenue or 5th Avenue.”
And that’s what he’s tried to imitate at his developments across Southern California. In Los Angeles, his best known properties may be the Grove and the Americana.
Even on an overcast mid-week afternoon, the Americana bustles with families. Caruso believes it’s because of the Americana’s park-like qualities.
“It taps into the natural rhythm of how we all live. Nobody naturally wants to go inside an enclosed box and spend the afternoon.”
He’s found that even bad weather won’t necessarily drive people away. But he’s offering something more than blue skies.
“An indoor mall has now become a destination. Somebody goes there, shops for what they want and leave…and it’s not a great experience.”
At the Americana, visitors walk their dogs on the sidewalks and kids play on the green. Music piped through loudspeakers is the soundtrack and a red trolley roles by intermittently. Caruso says he doesn’t mind if people come and don’t spend money.
“We’ve created an environment where you can come and enjoy yourself. And I’m going to get you the next time” he jokes.
Caruso emphasizes the strict attention to detail at the Americana.
He’s had a hand in designing everything – from the type of stone used on store fronts to the statues modeled after those in France.
“We’re in the entertainment business. You step on the property in the morning, it’s got to be perfect.”
And he’s serious about that – just like another entertainment company located not too far away.
“We study Disney and Disney studies us and we spend a lot of time with the Disney folks.”
For the malls that dot the country, Caruso sees a mixed outlook. Not all will survive. Those that do will have to become better at curating the mix of stores that shoppers can find there. They’ll also have to figure out what to do with the large spaces that big box retailers are shifting away from.
But when it comes to applying what he’s learned in Southern California to the rest of the country – Caruso’s not as interested. He wants to stay in the region. The rest he’ll leave to someone else.
“I think the best compliment I can give is not to say how much your programs have taught me (a ton), but how much Marketplace has motivated me to go out and teach myself.” – Michael in Arlington, VABEFORE YOU GO