Strip Malls Across the US: Modern Day Ghost Towns

By | Mar 14, 2011

GhostTown2

If you’ve walked through any of the local strip malls here in Tampa or anywhere else around the country for that matter there is one thing you are sure to find – lots of empty space.

Businesses that have been around for years seem to just disappear overnight. Many strip malls have more unoccupied retail spaces than full and some have become so bare that walking about one is not only uninviting but downright creepy feeling. You get a sense that you might have missed something big – a major political event, a civil war, a chunk of time that disappeared – something. You could have sworn there were stores in each of those locations just a few weeks ago and now they are all gone. Where did everyone go?

We all know the failing economy has hit the United States worker hard. Thousands of small businesses had to fold. Pressure to make monthly rent payments grew too much for many businesses as revenues were cut in thirds in some cases. At the same time, costs of supplies, well, costs of everything have gone up. For many, the pressure was just too much.
Why so much for rent? It appears rent for strip mall locations and other business properties have not come down very much proportionally as the housing market and overall economy tanked.

Commercial rent prices today are not all that different than they were a few years ago, considering the housing market has been decimated and there appears to be an overabundance of available space for rent. One would think strip mall owners would drastically reduce rent in order to attract new small businesses but it hasn’t happened. Isn’t some rental income better than none? Basic economics tells us that with an overabundance of supply and typical demand the only factor that has to change is price – unless of course demand has in fact dried up. Has the average business owner to be thrown in the towel with regard to getting back on his or her feet?

To the landlords, I would ask: Would it not be worth its weight in simple curb appeal to have the strip mall filled with active businesses if all it took was asking for a lower rent? Would lower rent prices stimulate new businesses to move forward with plans? Empty malls are creepy feeling and creepy does not attract customers or new businesses.

Is it that commercial property owners are so leveraged on their investments that when combined with falling property values, they cannot afford to lower rent? The answers probably lie somewhere in between but I would love to hear your thoughts about the state of commercial property in your area, particularly with regard to the amount of vacant strip mall space we see around town.

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