Michael Tseng – Retail Design Gets Nostalgic As We Look Toward The Future
Shopping Center Business
July 15, 2021
A fondness for what used to be has driven developers and architects to create a more community-centric, open and multi-functional retail environment that can withstand today’s challenges and tomorrow’s demands.
A year and a half since the start of the pandemic, retail is still retail. Placemaking still has its place. The need to be social and entertained persists. Eating outside of the house remains a treat. And brick-and-mortar stores continue to complement their e-commerce counterparts.
In many ways, the industry and its driving trends are the same as they were pre-COVID. And yet, everything appears slightly different as these trends were accelerated, restrictions and precautions were put into place and consumers re-evaluated their priorities — including how, when and why they spent their money.
This has led developers and their design partners to re-evaluate their centers and determine whether the physical spaces, tenants and offerings are in line with what’s to come in retail.
“We are always asking questions about the future versus today,” says Frankie J. Campione, founder and principal at Create Architecture Planning & Design in New York City. “We are always concerned with what the center wants to be years down the road, where the market is heading, what the demographics are stating and overly conscious of today’s trends, which are dated tomorrow. We believe understanding context and history provide a source of inspiration and the basis of a story to be told.”
Right now, our immediate history is on the minds of many. This has caused many designers to err on the side of caution, keeping plans loose and untied to any specific design trend in case another situation like 2020 rears its head.
“Plan for today but think about tomorrow by building in future flexibility without losing uniqueness or special appeal,” advises Kevin Zak, principal at Dorsky + Yue International in Cleveland. “We look for opportunities within the plan to create something unique, something that will not change over time, something iconic. We strive to create designs that feature layouts and places that facilitate community engagement that will be timeless and at the core of a development to brand its identity, while allowing for a development to evolve with time.”
Some pandemic-related trends, such as social distancing or masks, may fall by the wayside, particularly in the long-term. Others, such as a focus on community, BOPIS (buy online, pick up in store) and outdoor space, may be here to stay, notes Michael Tseng, associate principal in KTGY’s Retail Studio in Irvine, California.
“The pandemic has certainly changed consumer behavior with the outdoor environment becoming more attractive to the visitor, as well as restaurant operators,” he says. “We are seeing more retail developers spending money on expanding and renovating outdoor spaces to make them permanent fixtures, including opening up fenestrations (windows and doors) for operable storefronts. While we saw a trend toward outdoor community spaces prior to the lockdown, these measures have been impacted by the pandemic and the anticipation of another possible event.”
This has Mitra Esfandiari, senior principal at RDC in Long Beach, California, and her team hard at work on outdoor spaces in weather-friendly places like San Diego. RDC is currently working with Simon Property Group to create a centralized drop-off/pick-up zone at Fashion Valley, in addition to extensive landscaping and outdoor rooms that will provide open-air experiences.
“Due to this pandemic, there is an emerging preference for the outdoors as a safe haven, and shopping experiences better integrated with other daily activities,” Esfandiari says. “We are stressing the importance of indoor-outdoor connectivity, flexibility, open spaces and the incorporation of pop-ups.”
Indoor-outdoor connectivity can also be seen at Sky Deck, Donahue Schriber’s food collective at Del Mar Highlands in San Diego. The 26,700-square-foot space features 10 dining destinations, including a brewer’s deck and an open-air cocktail lounge. Sky Deck also contains 6,360 square feet of adjoining al fresco decks and patios that offer various outdoor communal areas, as well as a 35-foothigh, 2,100-square-foot skylight made of “smart glass” that can control the eatery’s temperature.
The communal dining destination boasts a nautical theme that includes a 100-foot-long ocean mural, hanging fishing boats, nets, glass floats and lobster traps. Sky Deck debuted in May, with the majority of restaurants scheduled to open in July.
“Donahue Schriber has invested in amenities and open spaces for public art and community gathering areas to encourage shopping and dining,” Esfandiari continues. “[Post-pandemic] we envision more seamless connectivity to the outdoors from facades with operable door openings, rooftop terraces, widening the sidewalks for outdoor dining, community gathering spaces with public art, recreational activities, farmers markets, food trucks, exercise classes, etcetera.”
Dustin Watson, founding principal of InPlace Design in Baltimore, also predicts most shopping centers and restaurants will retain some of their pandemic accommodations.
“I believe that the physical changes to the space will probably hang on and be adapted,” he says. “The restaurants that survived were the ones that were able to adapt to the changing world. They created walk-up windows, online ordering, exclusive takeout parking spaces, delivery, pop-up outdoor seating and take out alcoholic beverages. Most restaurants will probably try and hang on to these new revenue streams and develop them further for the future.”
They may also continue to utilize touchless doors, open-air walls for air circulation, space filtering devices and booth partitions, he notes. Though these precautions may be visible to visitors, Watson believes the dining experience will need to resemble a time before COVID to retain its charm and enjoyment for patrons.
“The consumer will continue to use the services offered, but the ones who prefer the in-person experience will more likely gravitate to the experience of old,” he says. “Where they do not need to be counted, wait in line or make a reservation.”
The outdoor dining trend is also occurring in malls, as Campione can attest. His firm helped PREIT carry out pandemic seating studies that would add exterior dining areas to Patrick Henry Mall in Newport News, Virginia.
“During the very first weeks of the pandemic, PREIT was one of our first clients that quickly stepped up to evaluate their properties,” Campione says. “We quickly assembled all their lease plans and site plans, located vacancies, adjacencies and proximity to areas outside the building envelope so we could identify locations to allow tenants to expand rent free to accommodate occupancies, as well as open-air dining opportunities. The goal was twofold: assist the current tenants with opening their doors as quickly as they could and make up for lost business.”
Create proposed two patio dining areas, including one near Forever 21 that accommodated Chipotle and Rice Restaurant patrons, and one outside H&M that served as outdoor dining for Red Robin. PREIT applied these same principals when it came to expanding its outdoor seating capabilities for Restaurant Row tenants at Springfield Town Center in Springfield, Virginia.
Despite the reports of its demise, mall developers across the country are investing in outdoor spaces as they evolve, rather than perish.
“AO has been tapped to modernize several major indoor shopping centers and malls throughout California — many incorporating new essential outdoor plazas and promenades,” says Rob Budetti, managing partner at AO in Orange, California. “Indoor shopping malls will still have their place, especially in locations that have high or low temperatures. However, customer expectations have shifted to desire outdoor plazas and promenades wherever possible.”
DEVELOPERS MULL MALL SPACES
Noel L. Cupkovic, principal of Cupkovic Architecture in Cleveland, believes demographics will dictate most malls’ futures, with their outlook not nearly as bad as the media makes it out to be.
“Large-format regional malls in high-density demographics should remain for a long time, and are necessary to serve those large, regional demographics,” he says. “These properties will constantly evolve as tenants change their offerings. It’s the secondary and tertiary markets that have older transitioning mall properties that will need to be re-positioned more drastically. Malls are most successful based on the demographics they are serving. If the population shifts or moves away, the mall needs to be re-purposed.”
That’s not to say that the mall concept can’t reinvent itself, particularly post-COVID.
“Sustainability will be more of an overall construction trend moving forward, with the end goal to be environmentally conscious,” Cupkovic continues. “I wonder if we’ll see a new mass timber regional mall with open-air and enclosed common areas and a mix of uses constructed in the next 20 years. I think we will.”
Malls that are located in high-density demographic communities, such as PREIT’s Cherry Hill Mall in Cherry Hill, New Jersey, should survive the current reckoning just fine. That doesn’t mean, however, that mall owners aren’t weighing their options.
“If malls are dead, send me a coffin,” Campione says. “While we aren’t seeing any new malls built, existing malls that are positioned well still serve their communities and a purpose. The issue with malls is that they, like so much other retail, landed literally everywhere, in A through D markets. There was and is a golden opportunity for malls to prove they are actually a safe, if not safer, environment post-pandemic, but there is a cost involved that few are willing to assume or have yet to figure out how to pass on.”
This has led some developers to focus on strategy development, Campione notes. One of the main determinations a mall owner has to make regarding an asset’s current or future strategy development involves whether the property is right for retrofitting, big box conversion, de-malling or other uses.
“Developers and property owners were already rethinking their assets, studying if mixed-use made sense, or whether it was right for open air, town centers, residential and hotel uses on vast parking lots,” he says. “It appears now those same developers and property owners are peeling back that same onion a bit more. For us, it’s this forward-thinking approach that tells the tale of the potential for malls’ long-term survival. It’s not the mall; it’s the developer that owns it.”
This strategy applies to open-air and strip mall owners as well. Regency Centers, for one, is demolishing the 31-yearold Costa Verde Center that sits adjacent to Westfield UTC in the San Diego submarket of University City. With a close proximity to the developing Mid-Coast Trolley Line and 18,000 residential units, Regency has partnered with biotech developer Alexandria Real Estate to create a multi-use destination with office, retail, a multi-level podium parking structure, open spaces and a hotel.
“Property owners and developers are eager to adapt the assets that they have to future-forward uses,” says Esfandiari of RDC, which will execute the redevelopment. “This includes adding residences, accommodating public transportation and pedestrian activity, increasing the mix of uses and creating the neighborhoods of the future.”
Costa Verde’s transformation is scheduled to commence in spring 2022.
The focus on mixed-use centers may be a newer trend for us, but for Cupkovic, it’s a throwback to a bygone era — an era that functioned pretty effectively for a long time.
“We strive for the balance of immediate satisfaction with the nostalgic feelings of what it was like at the turn of the last century, with a local downtown, offices and apartments above retail, walkable streets, simple and meaningful life experiences,” he says. “Basically, we are coming full circle. We’re re-learning what our ancestors knew 100 years ago. It’s really sort of funny, but that’s where we’re at. The way I look at it is like fashion, it cycles back every 30 years or so.”
Part of this Main Street feel is spurred by connectivity. Though the “trolley” of yesteryear is certainly different than the $3 billion trolley line expansion that will benefit Costa Verde’s future uses, the idea of places organized around convenience and transit isn’t a new one, Cupkovic contends.
“The trend of urban living and the supposed end of sprawl seems to have been delayed due to the pandemic,” he says. “Perhaps transportation-oriented development – with nodes of rural and suburban density and connectivity to urban cores – will be the next development opportunities. You sort of get your cake and eat it too. You can reside out of the larger urban core but have connectivity to it as well.”
Esfandiari certainly sees the appeal, noting malls often have proximity to major freeways and public transit, making them valuable sites for office, multifamily or industrial uses. Most malls also feature large surface parking lots that allow developers to erect new buildings or expand existing ones.
Stacey Berthon, senior vice president of Hoar Construction in Birmingham, Alabama, believes there will be continued focus on the suburbs as transportation options increase, people continue to work from home and a desire for more space has caused a residential boom outside of downtown cores.
“Even before the pandemic we were seeing the evolution of retail spaces from larger indoor malls to more live-work-play mixed-use centers with an emphasis on outdoor entertainment and shopping destinations,” he says. “This trend will definitely continue, and we’re seeing this become even more prevalent in suburban areas as town centers, where municipal offices come into the mix with retail, multifamily and other office space.”
What these diverse, service-dense projects will end up creating is sort of a mini town in and of themselves, Watson notes. Soon, some former indoor malls may encompass all facets of a consumer’s life, providing professional services, flex office, fitness, medical, retail and restaurant uses.
“The indoor mall will exist, but will be more of a full-service town under one roof,” he adds.
Existing mall owners partnering with, say, biotech developers may scare some within the industry. After all, it wouldn’t be unreasonable to assume that the physical retail footprint in these mixed-use projects may start to get smaller and smaller over time. But David Parrish, principal at RDL Architects in Shaker Heights, Ohio, doesn’t see that happening — at least not when high-quality mixed-use projects are paired with premier, demographic-oriented retailers.
“Two of our clients, Arhaus furniture and Pinstripes (which offers a bistro, bowling and bocce), are looking at going into the best real estate available in their preferred locations, whether it is a ground-up, redevelopment or conversion opportunity,” he notes. “What this says is that many elements of the retail industry are healthy and just trying to adjust to the curveballs being thrown at us from the pandemic and the economy.”
There are elements of physical retail that are healthy — and elements that are being re-examined to determine whether those spaces should stay retail, adopt a hybrid model or transform into something different altogether. Whatever the health report says, most retail investors are taking a good, hard look at their assets to determine if they’re ready to withstand the next wave of retail, and possibly the next disruptor that’s around the corner.
Campione believes architects and developers are up for the challenge — a challenge that was perhaps put off for a bit too long.
“We are seeing a very strong desire to reinvent properties, renovate entire centers and provide an entirely new shopping experience,” he says. “No more lipstick on a pig. Clients and shoppers alike are ready for the next new thing in retail. So lose those post-modern pediments, get rid of the flat monotone looks with a hint of ‘I’m thinking about sustainability’ wood elements. It’s time to rethink retail because the renaissance is here!”