Shopping malls across the nation continue to make strides in their recovery from 2020, when the pandemic all but shut them down in many cases.
That includes such malls as Topanga Village, which anchors a major corner of the Warner Center in Woodland Hills. The open-air mall, which was completed in 2015 and acquired last year by the Kroenke Organization, has continued to perform well.
“During a transition, there’s always a learning year and adjustment,” said Ally Lent, an asset manager with the Kroenke Organization who oversees the Village. “That said, we’re pretty satisfied with the performance, and tenants seem to be performing well. Dining and services have been the highest performers, in terms of sales but also driving traffic to the site.”
The 600,000-square-foot site boasts an occupation rate higher than 90%, Lent said.
Foot traffic has steadily climbed this yearwith the unusually rainy winter depressing that customer count at the start of the year. On top of better weather, Lent pointed to a handful of changes that she believes affected or will affect foot traffic for the better – the return-to-office of a large next-door employer, Farmers Insurance, earlier this year, and the pending development of the Los Angeles Rams’ temporary practice facility in a nearby lot.
Is retail dead?
Although the common refrain has been that shopping malls – and retail real estate at large – have lost their luster, there are indications of a more complex picture.
A report published in June by Coresight Research indicates that while the share of total leasable retail space in U.S. malls has fallen slightly since 2014, nearly 13% of retail and retail-adjacent spending occurred at malls in the first quarter this year. Occupancy rates at top-tier malls – those featuring luxury retailers and located where typical shoppers earn more than $200,000 annually – exceed 95%, and foot traffic at those locations is up 12%.
With the winter holidays in full swing, retailers can probably expect a boost in sales, too: the Americana at Brand, a Caruso-owned open-air mall in Glendale, typically records boosts in foot traffic from November through December.
More malls opened than closed last year, a first since 2016, according to the report. Additionally, retail sales at malls were up 11% last year. Part of the success has been adjusting to the rise of e-commerce. Retail experts this year have attributed modest import numbers to consumers spending more on dining and experiences, in contrast to the retail-heavy days of the pandemic.
At the Topanga Village, around a third of tenants are dining. It also boasts popular services like Burke Williams, Skin Laundry and Drybar.Â
After all, the Kroenke Organization saw fit to shell out $325 million to purchase the Village, an even half of the company’s total real estate acquisitions in the Warner Center last year. Company founder Stan Kroenke, who owns the Rams, pledged to maintain the Village as a retail destination as he develops a team headquarters nearby.
“It’s been a pretty good year,” Lent said. “The goal when you buy a shopping center in the first 24 months is to keep everything stable and that’s what we’ve been able to do. We’re pretty happy with it.”
The San Fernando Valley is not lacking for shopping malls. The Glendale Galleria and Westfield Topanga remain among the county’s top malls. And a portfolio including the Americana at Brand, Encino Marketplace, the Commons at Calabasas, the Lakes at Thousand Oaks and the Promenade at Westlake has helped Caruso’s namesake owner Rick Caruso become a homegrown billionaire.
