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New malls becoming more than just places to buy stuff
Thursday, July 14, 2005

People who flock to the region's newest shopping mall -- the Galleria at Pittsburgh Mills, which officially opens today in Frazer -- will find places to bowl, watch movies, have a few drinks and drive around in mini-race cars. For those so inclined, there will be stores, too.

John Beale, Post-Gazette
Katelyn Kelly, left, joins other hostesses and servers dancing at Johnny Rockets restaurant in the new Pittsburgh Mills Mall that opens today. The restaurant was open yesterday for employee friends and relatives as part of a training session.
Click photo for larger image.
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Online graphic: See a layout of The Galleria at Pittsburgh Mills in Frazer

The mall, which will be anchored by Kaufmann's and J.C. Penney, will later be joined by freestanding big box stores, including Wal-Mart, Sam's Club, and Lowe's. Add to that Lucky Strike Lanes and a NASCAR SpeedPark and you have "shoppertainment."

Whether through that kind of mix, which is practiced by developer Mills Corp. of Virginia, or the conversion of vacated department store space into apartments or the addition of full-service, sit-down restaurants, the nation's mall owners are turning their properties into places to eat, play, live -- and, of course, shop.

"They've figured out the longer you can get people to stay in the mall, the more they're going to buy," said Richard Moore, a real estate analyst who tracks mall-owner companies for KeyBanc Capital Markets.

That has become particularly important since 9/11, when consumers began editing extraneous visits to the malls out of their routines. Shoppers who used to go to two malls on a regular basis in search of a few more choices are now just going to one, said C. Britt Beemer, chairman of America's Research Group.

Even before the terrorist attacks changed people's priorities, enclosed malls were losing luster. Busy Americans rushing to soccer games and work and whatever else had become enamored of the convenience of strip centers and big box stores. Beemer said most malls are seeing between 20 and 30 percent fewer visitors than a decade ago.

People are busy, but they also were bored. "I think malls have done a great job of homogenizing themselves," Beemer said. "I think the whole mall environment is in jeopardy of being a 1990s, a 1980s thing."

As Pittsburgh Mills shows, the industry has no intention of allowing that to happen. Developers everywhere have responded, both by building open-air town centers such as the Waterfront shopping center in Homestead and by moving to create more distinct personalities for the enclosed malls that many Americans grew up with.

Monroeville Mall shoppers who have not been back in awhile might be surprised to see the new collection of shops that now sit next to the mall where cars once parked. A Borders bookstore anchors the row of storefronts easily accessible by car.

Ross Park Mall, which had more than 10 million shoppers visit in 1999 and claims to be the region's top mall, has been in a constant shifting and store-opening mode as the leasing staff worked to bring in new shops such as Aveda, Le Gourmet Chef and Club Libby Lu following a multimillion dollar renovation a few years ago.

Ross Park's skylights bringing in the outdoors and the shoe stores grouped in one corridor for easy comparison shopping would have been foreign to the original regional enclosed mall developers, who built mega-shopping centers where the weather was out of site and, rather like a Las Vegas casino, customers easily lost track of time.

Pittsburgh Mills, strategically placed in Allegheny County's northeast sector, should be more conveniently placed for some customers who have long driven long distances to Ross Park or Monroeville.

Actual new mall openings are relatively rare these days, in part because prime locations near populous areas are hard to find. It has been four years since Allegheny County saw the Mall at Robinson open, and Pittsburgh Mills is one of only five center openings expected in the United States this year, according to the International Council of Shopping Centers.

Both were planned two decades ago when mall construction was in its heyday, but ran into enough hurdles -- financing, economic swings, community concerns and road construction issues -- that they were completed long after other projects proposed at the same time.

The Mills Corp. and its deep pockets helped spur on the mall dreamed up by Johnstown's Zamias Services Inc., but the center could not have happened without the simultaneous unveiling of a new exit off Route 28.

At a cost of $340 million and with 1.1 million square feet, the new mall is coming in at a moment when traditional wisdom on what makes a mall work is being tossed out. For a long time, every leasing plan needed two, three, four or even more department stores as "anchors." Everybody shopped at a department store.

That is not true anymore, a fact driving the planned merger of the owners of the Kaufmann's and Macy's department store chains, which shareholders of both companies voted to approve yesterday. The merger is expected to be completed this fall.

Malls now think restaurants, theaters, even discount stores can play the role of main attraction, said Patrice Duker, spokeswoman for the International Council of Shopping Centers. Longtime strip center dwellers such as Target, Best Buy, even Wal-Mart are sometimes moving in.

SouthSide Works, the new development off East Carson Street that mixes offices, residential and retail, landed one of the industry's current favorite anchors -- The Cheesecake Factory, a restaurant that brings a steady stream of people past the neighboring shops.

"The department store will still always be there," said Duker. But in the future, she said, a mall with five anchors may have just one traditional department store., whose numbers are declining and whose all-under-one-roof relevance has come into question in this era of specialty and mega-discount stores."

Entrepreneurs smell potential, too. A Connecticut company is proposing to turn vacant anchor locations into sites where online and catalog retailers could set up bricks-and-mortar shops. Residential additions have the potential of creating a natural clientele and a 24-hour community.

Monroeville Mall owner CBL & Associates in May announced a venture to put 255 luxury apartments near a California mall. A CBL official was quoted at the time saying the company is considering similar deals for other centers.

Mixing workplaces and homes with stores is a delicate procedure but Duker said mall operators are learning how to make it work.

Malls must also work on getting men back through the doors, said Beemer. The number of women who use shopping as a sort of retail therapy pick-me-up has dropped nearly in half since a decade ago, leaving centers that are heavily focused on the female population vulnerable.

The combination of sports stores and entertainment venues at the Pittsburgh Mills could help bypass that problem, as will the layering in of freestanding stores such as Wal-Mart, Lowe's Home Improvement Warehouse and a collection of restaurants. Those will open on a staggered schedule.

First published on July 14, 2005 at 12:00 am
Teresa Lindeman can be reached at tlindeman@post-gazette.com or 412-263-2018.