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By Sheldon Gross, Sheldon Gross Realty, Inc.

Hot Trend for 2018: Mixed-use Villages


For several decades, experts on societal and retail trends have predicted the demise of the shopping mall. I reject this gloomy vision – in fact, I believe malls will be part of a very significant commercial real estate trends during 2018. But, certainly not in the traditional way many people still envision shopping malls. Without a doubt, most of the sprawling retail palaces erected during the 1970s and 1980s are dying … many are already quite dead. Some projections indicate that 25 percent of those remaining will be gone within just five years. In their place, we’ll see acceleration of an already ongoing trend toward mixed-use villages, which feature combinations of residential, corporate, and entertainment space, along with some remaining retail, and often a hotel. They also provide entertainment space, which – combined with the aforementioned offerings – make them true local and regional destinations. This model for how the vast mall properties of the 20th century will be used as we approach the third decade of the 21st century actually replicates the most desirable – and often most pricey – or our urban, downtown environments, which integrate places to live, work, shop, and recreate. It’s crucial to note that mixed-use village – sometimes referred to as urban villages – are not a vision of the future. On the contrary, successful examples exist throughout the country, and even more are currently in development. As we look ahead to more of these villages replacing dying malls, here are some things we’ve already learned from the earliest examples: • In densely populated areas across the U.S., builders are often forced by space restraints to “build small” in terms both of structure size and unit numbers. However, given the vastness of old shopping malls and their parking lots, this type of restriction is rarely an issue with mixed-use villages – and housing units can rise by the hundreds, not dozens. Generally, there’s sufficient space for every facet of a developer’s plan. • In communities facing an affordable housing shortage – both for buyers and renters – a mixed-used village can be tremendously impactful. Given the huge footprint of shopping malls and their parking lots, new homes and apartments all can be erected. • Creating a mixed-use village is no one-size-fits-all affair. In some cases, the existing mall structure is utilized, while in other more ambitious development plans, the old mall is removed and building starts from scratch. • Because the vast parking lots required by retail-only malls are far larger than what’s required for a mixed-use villages, developers have the opportunity to create multiple green spaces, including parks, playing fields, and even walking trails. Certainly, this is a far more sustainable environment than the old shopping venue. • Redeveloped shopping malls frequently feature space for community events and municipal uses. One of the more popular such components is a concert or theater venue. • Particularly with larger mixed-use villages, corporate tenants may find themselves in a dream location, given that large numbers of prospective employees reside right on their literal doorsteps. • With the significant variety of what mixed-use villages can and do offer, they’re an excellent environment for people of all ages. The opening of such a facility within a community ensures that a high percentage of the local population will spend time there, whether as residents, employees, students, consumers of goods and services, of some combination of all. Whether you refer to them as mixed-use or urban villages, or something else, they’ve already made serious inroads in the landscape of the American lifestyle. I’m predicting they’ll be an extremely important trend in 2018 … and almost certainly far beyond. Sheldon Gross, president and CEO, Sheldon Gross Realty, Inc.

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