The Decline of the Shopping Mall

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Yesterday, I was going to the Workforce Commission center at the mall in the town I grew up in, and the mall was half-deserted. Just 6 years ago, it was still a happening place. It was really weird.

In one of my urban planning classes, I had heard that shopping malls were being replaced with open-air shopping/entertainment centers.

Still, it was a weird sight.

Lots of half empty or abandoned shopping malls and strip malls where I live.

yes, our local shopping mall was replaced by a shopping center, I think it is really nice being able to walk outside from store to store to get some fresh air (okay, somewhat fresh air). The lazy people really love it also, because before, you might have had to walk from one end of the mall to the other to go to the next store, but now they can just hop in there car and drive to the other store.

I will admit, however, that the Mall of America is very nice. I have been there before.

Bricktown, in Oklahoma City, is really fake, though.

I like strip malls, better than conventional malls, anyways.

I think it's interesting, too--I used to follow http://www.deadmalls.com/

Most people buy their stuff online. With much lower prices, free shipping, and no tax, it doesn't make sense to shop in stores anymore.

Amazon, here I come!

I think a lot to do with it is that retailers prefer bigger, newer structures.

It was a passing fad. Everything was on Main Street fifty years ago. Four blocks with lots of small stores. When the burbs took off malls started being built, then bigger malls, then a mall on every corner, and now, 2,000 will close forever this year.

I buy almost everything on the internet.

Office buildings are another relic of the past.

The neighborhood where this mall (built in 1982) was located used to be middle class, but became more low-income over the years, as the middle-class residents moved to newer neighborhoods. A shopping center closer to the new communities was built in 2001-2002, and the old mall's tenants relocated to the new shopping center.

The new trends are these open-air retail centers that, if not on a river, are designed to simulate the old Main Street experience. If they are on a river, they are designed in more of a Riverwalk format (like the one in San Antonio).

Another trend, in the old industrial cities, is to convert abandoned factories into shopping-entertainment centers (many of the old steel mills in places like Pittsburgh were converted into shopping centers).

San Antonio looks like a beautiful city, I saw the River Walk on that Life After Man show on discovery.
Anyhow I am from Edmonton where the Mega Mall concept was born, West Edmonton Mall is huge
but after only a few years it was so filthy inside, I can definitely see it becoming a deserted mall in
the next 10 to 15 years, since the mall was built it has turned what was a clean beautiful middle class
neighborhood into a crime ridden ghetto.

There are two indoor malls in my city, and although we don't have a reason to go to them very often, it seems like every time we do, there are more empty stores than the last time. They both have whole wings with no open stores. Some of the bigger stores that used to be established businesses have moved out because it cost too much in rent to keep their stores in the mall versus the profit they made, and the smaller ones that have tried to stay afloat have gone out of business for the same reason.

One of the malls used to be more upscale than the other, but since the big companies have moved out, some of the stores have been replaced with discount merchandisers, like where you can get over 10,000 styles of cheap, shoddy, ugly shoes starting at $9.99. Even their food courts are changing for the worse. Last time we passed one by, it no longer had a Wendy's or Subway. When the big guys pull out, you know there's a problem.

It's going to be impossible for a lot of businesses to keep going when more and more shopping is done on the internet, and they haven't figured out how to collect taxes on those purchases yet. When you can comparison shop on different sites, do research and find the lowest price on what you want from someone who will ship it to your house, why would you go to a store in a noisy mall and take something from their limited selection, and pay a higher price for it, which they have to charge to be able to pay the lease on their space, and to cover the cost of employees? That seems to be the way it's going.

[youtube]http://www.youtube.com/watch?v=0Su_9nk5ua8[/youtube]
It's more cost effective to have warehouses with a web interface now.

Not exactly. First, if you buy from a business that has a physical location in your state ("nexus") they'll collect the tax. They have to, or they'll find themselves in deep doo-doo. Meaning Home Depot, Wal-Mart, Toys R Us, Barnes & Noble, etc., basically any big retailer you can think of is going to charge sales tax on on-line purchases.

An interesting exception is Amazon.com. Somehow Amazon has found a way around this, I think basically by holding their warehouses, which are all over the USA, in some sort of shell holding company. Probably they'd lose if a state decided to contest this arrangement on some sort of "substance over form" basis, but then Amazon would probably just close that warehouse and move to another state that would be less likely to challenge this arrangement. The arrangement smells like dogshit to me personally, but doubtless some lawyer got very rich coming up with this scheme, while I'm unemployed. So WTFDIK?

Edit to add: Use tax and sales tax are the same thing, except sales tax is collected by the retailer from the "final consumer," and use tax is paid (or is supposed to be paid) by that final consumer when the retailer failed to collect it for whatever reason, either because they didn't have to (no nexus) or because the retailer screwed up and somehow failed to.

Second, if you live in a state with a state income tax and a sales tax and have to file a return everyone I've ever seen has a nice little block for what is referred to as "Use tax." Yes, you can put zero in the block, but if you do that knowing you bought stuff and paid no sales tax on it, you're technically perjuring yourself when sign your return, or whatever it is you click to e-file "in lieu of a signature." I've never heard of a state going after someone on that basis, but I don't see any reason why they couldn't if they wanted to. I'm not a lawyer, but signing a legal document indicating something to be true when you know it to be false doesn't exactly take Alan Dershowitz to suss out what it is.

And MA, NY and CT definitely do audits on this stuff, though usually only on heavy hitters making $200k+ per year. (I'll bet most states have something similar, but I have no personal experience with them.) I worked at a place that had clients on the receiving end of these audits, and since I was basically lower than pond scum on the totem pole of this firm I was the one who had to wade through mountains of receipts and credit card statements trying to figure what they actually owed, since the states always come in with some ridiculously high number that they somehow calculate, plus penalties and interest, etc.

And, finally, someday the Streamlined Sales Tax (link) or something like it is going to come on-line, and be mandatory, not voluntary like it is now. When it'll happen who knows...they've been trying since 1999 or so to get Congress to allow it (Interstate commerce is something only Congress regulates), but it is an effort that seems to be gaining more ground lately, with states making an honest effort to change some of the more confusing variations of sales tax law from state to state.

Insomnia is a terrible thing. Can't believe I just wrote all that.

The Riverwalk was built during the 1930s during the Great Depression, as a Works Progress Administration project.