Many commercial-property investors are now developing properties to target Hispanics. Hispanics account for half of the population growth between 2000 and 2011. Hispanic households have more children than non-Hispanic households and outspend other groups on beauty products, food and apparel.
One particular commercial property manager owns about 70 retail properties and believes the Hispanic population can help revitalize dead malls. Property managers are trying to lure Latinos with a combination of live entertainment, children’s rides, and a mix of food and retail options to discourage online shopping. Economists who study retail agree that property managers should target Latinos as the population has increased purchasing power.
About 10% of malls tracked in an economic study will close in the next decade. About 190 malls currently have sales of $250 a square foot, below the U.S. average of $450 a square foot.
In 2004, a Fort Worth center was almost vacant. It was revitalized in 2006 to become “La Gran Plaza” and the center is now 90% occupied. A Phoenix shopping center called Dessert Sky was trending downward. A vacant Mervyn’s was turned into a Mercado housing several Hispanic-owned retail stalls. The mall showcased free musical performances and Latino themed festivities like Dia De Los Muertos celebrations. Almost immediately, the mall saw increased foot traffic and within a year, the property’s bottom line increased by 30%.
However, not all malls designed for the Hispanic audience are enjoying that kind of success. One property, the Fiesta Mall in Arizona, was especially crushed by the recession. Some customers have said these new malls feel like going to a “swap meet.” However, property managers have plans to continue revitalizing malls to appeal to broader audiences.
Why are mall owners trying to attract Hispanic shoppers?
What are they doing to attract them?
SOURCE: Miriam Jordan, Wall Street Journal, August 13, 2013