“Malls are diversifying their tenant base to appeal to millennials and Gen Z who prefer experience to the traditional, retail-heavy shopping spaces,” said Stephanie Cegielski, spokeswoman for the International Council of Shopping Centers. “This is manifesting itself through an increase in f&b (food and beverage), fitness, entertainment, and other non-retail offerings. Retailers are also integrating technology into their store to appeal to shoppers who want a more digital experience.”
Construction recently began on the former Sears store at the Beavercreek mall for its first large-scale entertainment tenant. Rapidly expanding Japanese-based Round1 Entertainment will replace the bottom floor of that more than 100,000 square-foot box with bowling lanes, putt-put golf and video games. The concept is expected to open later this year.
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Large-scale entertainment concepts are one of the few things able to fill even half of the sometimes more than 200,000 square-foot storefronts left vacant by dying retailers like Sears, Macy’s, JCPenney and Elder-Beerman’s parent Bon-Ton.
“Entertainment, food and beverage play an important role as we continue to diversify tenancy, as well as – plain and simple – make our assets more fun,” said Lou Conforti, CEO and director of Washington Prime Group, which owns the Mall at Fairfield Commons, Dayton Mall and dozens of others across the nation. “The addition of Round1 illustrates this objective.”
The nearest Round1 Entertainment opened in November in a former Macy’s store at that the Jefferson Mall in Louisville, Kentucky. Since the business opened a few months ago, the shopping center has “definitely seen an increase in traffic,” said Stacey Keating, spokeswoman for CBL Properties, which owns the Jefferson Mall.
"People are looking for a broader range of experiences. That's why we're adding these entertainment venues to our properties. But it's also why we're adding additional dining options and more sit-down restaurants," Keating said.
It’s too early to have definitive numbers on how much Round1 benefited the Jefferson Mall, but the amount of time and money spent at the Cool Springs Galleria just outside of Nashville saw a jump after the mall added a similar entertainment destination, King’s Bowling and Entertainment, a few years ago, Keating said.
Before the redevelopment, sales per square foot at the shopping center were $459. By the end of 2017, after the redevelopment, they’d jumped 15 percent to $526 and have continued increasing, Keating said.
CBL Poperties is adding a similar entertainment concept called Whirly Ball in a vacant Sears and a luxury dine-in movie theater in Milwaukee. A mall in Chattanooga, Tennessee, will fill a vacant Sears with a Dave & Buster’s and new retail, along with adding hotel and office space.
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A Simon Property Group Mall in Indianapolis has added several options including Glow Golf; Knockerball; Rhythm Discovery Center, which offers an interactive percussion museum and artist performances; Tilt Studio, a massive arcade with virtual bowling, laser tag and claw machines; Punch Bowl Social, an “old school” entertainment concept with private karaoke, a vintage arcade, bowling and table games like ping pong, billiards, and foosball; and an upcoming Helium Comedy Club.
In addition to bowling and arcade game concepts, malls have taken up indoor skydiving with virtual reality technology that puts participants in movie scenes, rope climbing, indoor roller coasters like the Nickelodeon ride at the Mall of America, high-tech driving ranges, escape rooms and miniature golf.
Kids activities like the Crayola Experience with the closest location at a Pennsylvania mall are growing. Children can print their name on crayons, color on tablets, meet Crayola characters, play on a colorful playground and see art come to life with augmented reality.
Other vacant retail at malls is being filled by emergency medical services, fitness concepts, apartments, hotels, condos and office space, whether that means using the boxes or tearing them down to rebuild on the lot.
“Ultimately we want to redevelop properties in a way that is most appealing to our customer base and they’re saying: yes we want great retail. We also want a place to eat at the best restaurants and we want to go to the movies and workout and even perhaps live on on the property and have our guests stay at a hotel there…we want them to be live, work, play type of environments,” said Les Morris, spokesman for international mall and outlet owner Simon Property Group.
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CBL Properties is filling a vacant JCPenney with a Planet Fitness and H&M store. The Galleria at Erieview in Cleveland has a full YMCA inside the mall and at one point used the natural lighting through glass ceilings to create a greenhouse. It was recently purchased by developer who plans to turn an office tower at the property into luxury apartments.
Local Upper Valley Mall in Springfield reportedly is in negotiations for plans to fully redevelop the mall focusing on a large sports complex for soccer, baseball, pickle ball, basketball, go karts, volleyball and competitions, surrounded by restaurants, a movie theater, retail and a trampoline park, according to a Facebook post from Home Plate Sports Academy, which will operate the expanded sports complex.
Most area malls are not in danger of shutting down, said University of Dayton marketing professor Riley Dugan. Online sales may have a more lasting effect on physical retailers, but malls typically go through cycles where sometimes they’re doing really well and other times they’re not, she said.
Round1 will be the first major entertainment option inside a mall in the Dayton area, but it’s not Washington Prime’s first adventure into the sector. The Mall at Fairfield Commons recently opened The Yard, an area above the main entrance that include oversized chess, ping pong and air hockey.
The addition of Round 1 and The RoomPlace, totaling over 100,000 square feet, are just two examples of how we’re transforming our assets into town centers by diversifying tenancy and activating common area,” Conforti said.
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The concept of Round1 will be welcomed by area shoppers, Dugan said. Bowling is a relatively low-cost hobby that is received more favorably in Ohio than in larger metro areas like New York and Los Angeles.
"Ohioans really like to bowl. I think it's one of those hobbies that cuts across social class a bit," he said.
The company has something for everyone from kids playing Dance Dance Revolution, which attracts people from hours away at the Jefferson Mall in Louisville, to older customers drinking a beer while playing classic arcade games, said the Round1 manger at the Jefferson Mall Ian Grossing.
"We have helped the mall immensely," he said. "In our area, there's actually three malls within a 30 minute drive —our mall being the oldest and the least frequented of the three. And we have revitalized the mall and we bring in a lot of traffic that has abandoned the mall for other shopping venues."
The Jefferson location has 60 employees, a similar number to what Grossing expects the company will hire in Beavercreek. Round1 hasn’t chosen a manager for this location yet, a recruiter said.
Future of Dayton malls
Round1, along with The Room Place, will fill the Sears box at the Mall at Fairfield Commons, but there are several other major vacancies left to fill, including Beavercreek’s Elder-Beerman and both the Elder-Beerman and Sears stores at the Dayton Mall.
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Several mall leaders said redevelopment types are specific to each market. What works in Nashville might not be ideal for Dayton.
“It’s hard to say what regional malls will look like. Good real estate responds to the needs of the community, which depends on many factors including the local economy and shifting demographics,” Cegielski said.
But ICSC research shows that Gen Z, the newest generation, goes to the mall more than older generations and two-thirds say they still expect to make most purchases in physical stores five years from now, she said, which is pushing retailers to continue investing in physical presence.
One of the options Dugan said would be particularly special for Dayton is a celebration of the rich brewery culture in the area. It would be expensive to have a brewery in a mall because of the space required, but tasting rooms would provide an experience.
"You could have a kind of small retail establishment where a particular brewery is going to offer some rare, exclusive beers. And so, in a sense, kind of like a bar setting, but because it's local, because it's personalized, I think people are gonna respond better to than some sort of generic bar," Dugan said.
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