Ghost malls salient feature of depression

washington ghost mall

washington ghost mall

“Less than 400,000 square feet of new strip mall space was added in the second quarter, so increases in the national vacancy rate are coming from existing properties bleeding out, not from new properties,” Calanog said.

July 7 (Bloomberg) — Vacancies at U.S. neighborhood and community shopping centers moved closer to the highest on record in the second quarter amid signs the economic recovery is losing steam and consumer confidence remains subdued, Reis Inc. said.

We need more neighborhood small shopping centers. The sort with more local flavor and local ownership. If people had the opportunity to walk to the market for fresher produce, meat, and bakery items, our streets would be less crowded, and less polluted. We may even be healthier. We may get to know our neighbors, which in turn could lead to closer knit, and more secure neighborhoods for our families.We would have less dependency on multinational corporations to feed/clothe us. In this case I believe smaller is better. For instance, the recent Listeriosis outbreaks may not have been as widespread if we were more community oriented as we were in the past. More local money would stay in the community instead of being sucked away to points unknown. This is all hypothesis, as I know most people are hooked on Big Box Stores, and driving everyplace, even if it is just down the block.

Indeed, some analysts estimate that the number of so-called “dead malls” — centers debilitated by anemic sales and high vacancy rates — will swell to more than 100 by the end of this year [2009]. General Growth Properties, which owns more than 200 U.S. malls, filed for bankruptcy protection April 16, due mainly to its failure to refinance billions of dollars of debt coming due. While the real-estate investment trust has said the filing will have no impact on its mall business, analysts say a prolonged bankruptcy proceeding could make retailers nervous about sticking around once their leases expire.

Continued from Bloomberg, the vacancy rate at shopping centers rose to 10.9 percent from 10 percent a year earlier and 10.8 percent in the first quarter, the New York-based real estate research firm said in a report today. It was the highest since 1991’s 11 percent. The record for shopping center vacancies since Reis began tracking the data 30 years ago was 11.1 percent in 1990.

“There are really very few reasons to believe that performance deterioration won’t continue for another 18 to 24 months for retail properties, although there are some signs that the pace of decline is moderating,” Victor Calanog, director of research, said in the report.

Out of 80 cities, 11 posted increases in rents paid by tenants. “Compared to the last two quarters, when most if not all of our markets posted declines in effective rents, this is good news,” Calanog said.

The Standard & Poor’s Super composite Retailing Index has fallen 23 percent since April 26, when it touched the highest level since July 2007.

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