Directory of Major Malls
Directory of Major Malls

Taking a Look at Shopping Center Growth in North America By the Numbers

shopping center growthAcross the U.S. and Canada, demand for shopping centers of all types is heating up. The number of planned renovations underway reflects developers’ and owners’ optimism about the future profit potential of shopping centers and their role in our society.

Many say the “retail apocalypse” will be the end of the physical retail model as we know it, but the numbers tell a much different story. Shopping centers must adapt to a new reality and a new consumer, but they’re as relevant as ever and will become more so as renovations are completed.

New construction and renovations around the country reveal the shifting priorities of real estate owners as they adapt to the new retail landscape and what they believe are the most successful forms of shopping centers.

Here’s a look at shopping center renovations across the country by the numbers.

Types of Shopping Center Renovations Across the Country

Overall, there are 1,395 shopping center renovations planned in the U.S. and Canada, according to the Directory of Major Malls / (DMM) database. This includes all classifications of shopping centers with renovations planned any time between 2018 and 2035.

When categorizing shopping center renovations by type, the breakdown of renovations looks like this:

shopping center infographic

Across all types of shopping centers, moderate to robust renovation activity is expected, signaling the anticipated success of these shopping centers. A few key areas experienced significant growth.

Growth Highlight: Lifestyle/Specialty/Mixed-Use CentersGrowth Highlight: Lifestyle/Specialty/Mixed-Use Centers

With a focus on upscale mixed-use tenants in an open-air environment, lifestyle/specialty/mixed-use centers are expected to see a lot of renovation activity. In fact, the 307 centers with planned renovations accounts for 26.81% of all these types of centers, the highest rate among all types of shopping centers.

Owners and developers see major potential success by creating mixed-use spaces that include residential, office, entertainment, food and retail space all into one complex. On one hand, owners can attempt to reach a much larger market to fill existing vacancies and diversify their tenant mix. On the other hand, a good mix of tenants increases exposure to consumers and can provide for better overall shopping experiences. Lifestyle/specialty/mixed-use shopping centers are a model that many in the retail industry see as the wave of the future.

Growth Highlight: Community CentersGrowth Highlight: Community Centers

Community centers are the smallest of all the shopping centers, but uniquely tailored to serve the needs of the surrounding community. While only 12.46% of community centers are actively planning a renovation, this translates to 500 community centers across the U.S. and Canada. According to JLL research, there’s approximately 7.6 million sq. ft. of neighborhood and community shopping centers currently under construction.

The community center is another ideal model for shopping centers. By tapping into the unique needs of the surrounding community, these shopping centers aim to drive higher foot traffic and serve as a place where people can spend leisurely time. In one sense, they try to emulate an idealized downtown area while trying to cater to consumer staples. Shopping centers with grocery stores or other consumer staples, according to research from Thasos Group, drive more foot traffic and those with more retail-oriented options. The community center offers value beyond the products that can be bought there.

Shopping Center Renovations By Region

Breaking down the view of shopping center renovations even further, various regions across the country expect different levels of renovation activity in different types of shopping centers.

Northeast Shopping Center Renovations
The northeast has a moderately high number of shopping center renovations planned, mostly focused around community centers and lifestyle/specialty/mixed-use centers. Few value retail center renovations are planned here in comparison to the rest of the country.

Northeast (221 total renovations planned)
93 community centers
3 entertainment centers
40 lifestyle/specialty/mixed-use centers
34 power centers
30 regional centers
18 super regional centers
3 value retail centers

Southeast Shopping Center Renovations
The southeast has the highest concentration of planned shopping center renovations, and much like the northeast, much of this activity focuses on community centers and lifestyle/specialty/mixed-use centers. Despite the high volume of renovation, very few entertainment centers are planning renovations.

Southeast (294 total renovations planned)
97 community centers
2 entertainment centers
79 lifestyle/specialty/mixed-use centers
44 power centers
39 regional centers
23 super regional centers
10 value retail centers

North Central Shopping Center Renovations
The North Central region of the U.S. has one of the lowest volumes of planned shopping center renovations. Relative to the number of total shopping centers, a very high percentage of them are community centers. No entertainment centers in this region are planning renovations in the near future.

North Central (183 total renovations planned)
77 community centers
35 lifestyle/specialty centers
31 power centers
19 regional centers
17 super regional centers
4 value retail centers

South Central Shopping Center Renovations
The South Central region of the U.S. has the second highest volume of planned renovations. Like most regions, there are a high number of community center renovations, but the South Central region also has a high number of regional center renovations planned.

South Central (279 total renovations planned)
96 community centers
3 entertainment centers
71 lifestyle/specialty centers
38 power centers
41 regional centers
21 super regional centers
9 value retail centers

West Shopping Center Renovations
The western region of the U.S. has a high number of shopping center renovations under way. Community centers and lifestyle/specialty/mixed-use centers once again top the list, but a high number of value retail centers are planning renovations in the west.

West (258 total renovations planned)
70 community centers
2 entertainment centers
67 lifestyle/specialty centers
55 power centers
31 regional centers
21 super regional centers
12 value retail centers

Canada Shopping Center Renovations
Canada has the least number of planned shopping centers renovations. Community centers represent the vast majority of those planning renovations, while regional centers are also very high considering the low volume of renovations.

Canada (160 total renovations planned)
67 community centers
2 entertainment centers
15 lifestyle/specialty centers
18 power centers
39 regional centers
13 super regional centers
6 value retail centers

couple at shopping centerAcross the U.S. and Canada, shopping center renovation activity is widespread. When taking a closer look at the nearly 1,400 total renovations planned, the trends by region and type of shopping center reveal the priorities of real estate owners and what they see as the most successful way forward.

Some types of shopping centers are seeing great success, as evidenced by their high number of renovations, while others are seeing more moderate growth. As a whole, the shopping center model is adapting to a new digital world driven by consumers with new demands. Owners are renovating quickly to keep up.

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