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Jax Daily Record Friday, Sep. 20, 201905:20 AM EST

My view: As retailers vanish, creative uses needed for big-box spaces

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Up-and-coming artists, food truck-style eating areas are some of the ways to turn around vacant retail centers.

By Donn Carr, Carr Management Group

Will The Avenues mall be able to fill the space vacated by Sears when it closes by mid-December?

This is the million-dollar question that major developers face today – how to fill vacant big-box spaces.

Department stores have lost their allure and are struggling. The challenge to the developer becomes real when you add the recent financial challenges of Forever 21, a retailer that used to backfill those large vacant department store footprints, and a diminishing number of new retailers who want space that large or who can sustain the financial burden of the high operational cost of it.

Conventional thinking is no longer viable. The days of backfilling with a theater or gym no longer make sense. 

The new customers do not want the shopping mall experience of their parents. They want and need something with which they can identify.

Donn Carr, the principal partner and president of Orlando-based CarrĀ Management Group, managed The Avenues mall for 13 years.

Consider that millennials are expected to make up 50% of the workforce by 2020 and 75% by 2030. This market group is interested in the experience as well as the perceived value. Any old store simply will not work. 

This group was raised on instant gratification and social media. Most do not recall not having a cellphone and, for some, a smartphone. 

They also are not loyal as a group and their attitudes of what will attract them to one place over another have been elusive. 

However, I have seen some creative uses for these vacant boxes in Latin and South America that speak to the younger and more tech-savvy customers.

This speaks largely to the success of the recent popup retail centers that used old, discarded shipping containers and stacked them on top of one another. The build-out cost is low, and it creates a fun ambiance that entices customers to not only come but to stay longer (the goal of all shopkeepers).

The bonus: The cost is considerably lower. We are seeing these pop-ups in the Lake Nona area of Orlando.

Some of the more creative uses for these vacant big boxes is to gut them and, by using a community theme, create a series of small 15-by-15 spaces with some creative overhead decor to add ambiance and lease them to up-and-coming artists and craft persons. 

Think of it as a large incubator where one-of-a-kind items can be found.

It is a win-win for everyone as the rents for these smaller spaces can be affordable while the constantly changing retail base brings in customers who want to see what is going on inside.

When coupled with a food truck-style eating area, the dead space becomes a desired place to shop and create a business while adding to the footfall for the existing center. 

We did this in Panama City, Panama, last year and the local artisans loved it. 

Other uses might include medical (a hot commodity right now), the creation of living space to accommodate the new coworkers, or to subdivide it into a Class A business center, which also makes sense as the hard costs are done. 

Again, the goal is to draw additional foot traffic to cross-shop with the tenants of the existing center, rather than create competition with it.

Someone said: “Old malls don’t die – they simply get recycled.”

That is what we are seeing. The winners will be those daring enough to be pioneers. We don’t want much to do with yesterday’s experience.

Make me want to shop with you over the other guy. Whoever wins this challenge will be the leader for some time to come.

Donn Carr is the principal partner and president of Orlando-based Carr Management Group, serving as an international business consultant and trainer specializing in customer service, retail and shopping center experience. He was a mall manager with Simon Property Group for 21 years, including 13 years managing The Avenues mall in Jacksonville from 1996-2009.

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