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by teddyh 2609 days ago
I would assume that the decline of specialist shops is strongly correlated with rising rents for storefront properties. But with online shopping on the rise, maybe landlords (outside shopping malls and after some years to pass through the stages of grief) can accept that there just isn’t that much money in rents for storefronts anymore, and that specialist shops thereby can continue to exist.

Of course, the risk is that they will just tear it all down and convert it into lofts, office complexes or something instead, leaving nothing except lofts, office complexes and huge malls.

3 comments

Old stock city quarters are almost universally mixed use here, commercial on the ground level and residential above. Living on ground level, with people passing by right in front of your window isn't exactly popular so those shops are increasingly staying empty and it's not just a result of the internet, but also the move of daily goods from small shops to supermarkets (of being size, smaller ones usually still available within walking distance). Unfortunately, some shops get converted to residential (it's higher rent now that the old guard of shops has mostly disappeared), others to small offices, but the most interesting are those extremely specialist ones that can only exist backed by online distribution. And it's not even limited to big places like Berlin. Realistically, a specialist store would be considered out of range if it is not in the surrounding quarters of either work or home, unless need is really pressing, so theres a bit of diminishing returns going on between larger city size and viability of specialist stores.

In Nuremberg, a city much smaller than Berlin I had a model rocket shop (strictly model rockets, absolutely no branching out into RC planes or fireworks) in walking distance, and one specialising into some specific subset off fishing lures, in a region completely lacking any fishing culture (the carp farms that are the traditional fish supply are harvested with partial draining and nets). A sub-kilometer move later, in a quarter developed mostly with residential ground floors, nothing like this exists. Still some empty shop fronts, but maybe your enough to drive commercial rents down to the point where "exotic online specialist with occasional walk-in business" becomes viable.

I don’t know about in Germany, but the huge malls are going the way of the dodo in the US.
I briefly worked for a retail company a couple years ago that was getting amazing sweetheart deals on short-term leases in malls because the mall owners almost literally could not give away the space. They are desperate to host just about anything in order to make their mall look less like a ghost town.
People say this, but both of the malls I've been to in the past few years (one in Bellevue, WA and one in Chandler, AZ) have been completely packed almost every time. Is it really still true that malls are going away?
A-class malls are still doing well. The mall you're referring to in Bellevue, where I have also been, is a class-A mall.

Class-A malls tend to be in busier, higher wealth, sometimes more urban areas, have best in class furnishings, and have tier-1 national tenants, with many of those tenants catering to more of a premium/luxury consumer.

Most B-class or C-class malls, however, are dying.

I believe it’s actually the smaller malls and malls near smaller towns that are dying from oversupply. The giant warehouse style stripmalls have hurt the small malls in the exurbs. Big malls in big cities seem to still be expanding.
Berlin just opened its 61st mall (all in the order of 20+ shops) a few month back, so at least in the centre they are going strong.
I read in the economist the US has nine times the square footage of shopping malls compared to the UK.
My guess would be that the close of small shops is due more to sales lost to online shopping than the natural rise of rent costs.