Ten years ago the Toledo area mall scene was like a retail war with four enclosed shopping complexes -- Westfield Franklin Park, Southwyck Shopping Center, North Towne Square, and Woodville Mall -- competing for consumers' dollars and loyalty.
A decade later the war is over, said Pete Shawaker, a local commercial Realtor with CBRE Reichle/Klein. "Franklin Park is the winner in all of this. They're the last guy standing," he said.
But while three of the malls, Southwyck (closed in 2008 and demolished in 2009), North Towne (closed in 2005), and Woodville (forced to close in 2011), are gone or closed, experts say do not expect replacements because major retail expansion and mall building in Toledo are likely done for the next 20 years.
"In the future, being serviced by retailers will mean reduced needs and fewer malls," said shopping-mall consultant Stan Eichelbaum, head of Marketing Developments Inc. "Toledo is a second-tier market. A first-tier market may end up having one to three major malls; a second tier, one dominant mall, and for a third tier, there's a question of whether they need a mall at all."
Construction of enclosed malls seemed unending from the 1970s to the early 2000s.
But it came to a screeching halt even before the 2007 recession.
The last traditional enclosed mall, the Mall at Turtle Creek in Jonesboro, Ark., opened in 2006. Just two enclosed retail complexes have been built since, but even they were not traditional malls, said Jesse Tron, a spokesman for the International Council of Shopping Centers.
"With the recession, development in general has slowed. What people have focused on now is redeveloping their properties," Mr. Tron said. "But what remains to be seen once we do go back into the redevelopment phase is what style will end up being the trend?"
The last 10 years developers have favored open-air lifestyle centers, which led to the 319,000-square-foot Levis Commons in Perrysburg in 2004 and the 640,000-square-foot Shops at Fallen Timbers in Maumee in 2007.
Of late, outlet malls serving a more discount-oriented buying public have regained favor, Mr. Tron said. When development does restart, enclosed malls may not make much of a comeback, he added.
"I think you're going to see a little bit or a mix of everything. Wherever [developers] can fill a niche, they will," he said. "That may mean an enclosed mall here or there, an open-air lifestyle center, or a couple more outlets. People are focused on value now. That's what's driving the outlet malls."
For Toledo, the likelihood of additional large retail projects to be built over the next 20 years is slim because the area's population is not growing and retail was overbuilt locally in the 1990s and 2000s, Mr. Shawaker said.
The last major retail expansion has been along U.S. 20 on the Perrysburg-Rossford border, where several big box stores such as Meijer, Wal-Mart, Target, and Best Buy have developed sites to serve the shift of the area population to that locale. But even that development is largely over, Mr. Shawaker said.
Geographic shifts of Toledoans to Maumee, Monclova, Sylvania, Perrysburg, Waterville, and Whitehouse are completed, giving retailers and developers no new locales to chase after customer bases, he said.
"The geographic shift is what caused the construction of Levis [Commons] and Fallen Timbers," Mr. Shawaker said. "But that population has settled, the geographic shift is over. There's not a pent-up demand anymore of people wanting to move out there."
For Levis Commons, which is co-owned by developer Larry Dillin and Hill Partners Inc., and Fallen Timbers, which is owned by General Growth Properties, that means at least two decades of no additional competition, Mr. Shawaker added.
Levis Commons says it is about 90 percent occupied. Fallen Timbers, which does not disclose figures, appears to be 76 percent occupied based on the number of vacant store fronts. Franklin Park, which also does not disclose occupancy rates, appears to be 92 percent occupied based on vacant store fronts.
"What [General Growth] did to Southwyck -- take away their tenants -- isn't going to happen to them because there's nobody left to come along and challenge them," he said.
Toledo is "a mature market now and maturity means we reuse what we have," Mr. Shawaker said.
Steve Serchuk, a broker and retail expert with the Toledo office of Signature Associates Inc., agrees that it will be at least 10 and more likely 20 years before the area sees a new mall or large retail center built.
Franklin Park, the 1 million-square-foot traditional enclosed mall owned by Westfield Inc., will remain dominant, but it and Levis and Fallen Timbers could undergo significant changes over the next two decades, Mr. Serchuk said
Shoppers still prefer shelter from the elements, so it isn't inconceivable that parts of Levis or Fallen Timbers could be enclosed in the future, Mr. Serchuk said. "I still see that because of the northern environment. People here like the climate-controlled shopping," he said.
As for Franklin Park, the changes will be in what it offers, he said.
"I think people want a sense of place, and they need to congregate, and shopping is a key element of congregating," he said. But people are looking for more than just fashions, which means malls will have to redefine themselves to include health and education aspects in addition to recreation and entertainment, Mr. Serchuk added.
Mr. Eichelbaum also sees malls becoming less of a fashion mecca and more what they began as in the 1970s -- the new town square with aspects devoted to health, education, dining, and entertainment.
"The truth is, America had a love affair with the polo shirt and fell in love with fashion. Then stores came along to satisfy that demand and the mall became way too fashion-oriented for its own good," Mr. Eichelbaum said.
Mall development was strong, but it was fueled largely by the economics of the 1990s when consumers had excess buying power and high wages to spend in trendy boutiques and niche retailers. "We built enough retail to service that over-earning period, but then we began to cut salaries, cut the labor force," Mr. Eichelbaum said.
Now, owners are closing excess malls or redeveloping existing properties. "You are seeing a lot of reorientation of everything, but you aren't going to see a lot of building in America for a very long period," Mr. Eichelbaum said.
"Is this something new? No. It's really a deja vu of the 1960s when the downtowns ruled the roost," he said. "The malls came along and created ring roads and proliferated an incredible amount of retail."
Downtowns could have survived if they had adapted to other uses, like health and education, but most did not, Mr. Eichelbaum said.
Now the same dilemma is facing the malls.
"I think you're gong to see recycling of the existing malls and some new concepts come along. But when this happens, some things are going to have to close down because we just have an over-maturation of the markets," he said.
"The truth is that some of these malls are not going to be needed and some are going to be shrunk to fit."
Contact Jon Chavez at: firstname.lastname@example.org or 419-724-6128.