Tuesday, April 27, 2010

Mall rot: how they do it in Dixie.

This blog is due for another photo montage, and while the subject this month is hardly original, it remains one of my favorite: the always fascinating dying mall. I’ve explored several examples in the past: two in Indianapolis and one outside of Detroit. But dying malls are hardly relegated to the Midwest—all across the country, a number of regional enclosed shopping centers have met their demise over the past twenty years. So now it’s time to focus the lens on one in the South. I’ve referenced the Cortana Mall at Baton Rouge obliquely through a previous post; this time I finally visited it with a carefully hidden camera.

Dedicated in 1976, the Cortana Mall (formerly Mall at Cortana) opened about 6 miles west of the Baton Rouge City Center, in a section from the old Cortana Plantation parcel, at the intersection of two arterials, Florida Avenue (U.S. 190) and Airline Highway (U.S. 61), indicated by the purple letter A on the map.

Originally nearly 1.4 million square feet, it was the largest mall in the state, and in 1981 it expanded by over 200,000 more square feet, when one of the early department stores added a second level. A more detailed history of the mall is available at Mall Hall of Fame.

The mall endured several battalions of new competitors over the ensuring two decades, but nothing unseated Cortana from its dominion as the pre-eminent mall of the Capital City region. However, in 1997, developer Jim Wilson and Associates opened the Mall of Louisiana to the southeast of the city center, along the mercilessly well-traveled Interstate 10 corridor, at its interchange with Bluebonnet Boulevard, indicated by the blue B on the map. Cortana Mall was dethroned.

Cortana didn’t die overnight; thirteen years after the unveiling of the Mall of Louisiana, it remains open. Within a year after the competitor stole the spotlight, Cortana Mall underwent a mild renovation and changed its name to Mall at Cortana; it returned to Cortana Mall last year. Truthfully, this Mall has persevered as the “other mall” in Baton Rouge metro for a remarkably long time. Aside from the Mall of Louisiana, other formidable competitors include the lifestyle center Towne Center at Cedar Lodge (2005, just a little over 2 miles away, the green letter C on the map), the Tanger Outlets in Gonzales (an outer suburb 21 miles to the southeast along I-10), and the recent lifestyle/apartment/office hybrid Perkins Rowe (2008, just a mile south of Mall of Louisiana, also on Bluebonnet Boulevard at the purple letter D on the map). It is no doubt a testament to the solid population growth of metro Baton Rouge that Cortana Mall has been able to endure this long. When I first visited in 2005 (which I briefly referenced a few months ago), I could tell that it was the downgraded mall—quite simply, it lacked the upscale stores such as Banana Republic, Brookstone, Talbots, and any of the other solidly upper-middle tier stores present at Mall of Louisiana. Nonetheless, it seemed generally bustling around Christmastime, with relatively low vacancy except in the wing of in-line stores that lead to the notorious Sears. But that was nearly five years ago. How does it look today?

It’s seriously hurting, with about 50% occupancy, I would guess, among the in-line stores. And in answer to the question posed by the title of this blog, they don’t really do mall rot that differently in the South than anywhere else, by my observation. Among the few tenants currently entering the mall are fourth-tier brands without any major advertising presence, like Famous Labels seen below:

This is precisely the sort of tenant that seeks a struggling retail outlet, because that caters to the lower income market that still shops here. The well-heeled of Baton Rouge stopped patronizing Cortana long ago, and now the foot traffic and ensuing sales per square foot are so low that the place cannot ask for high rents. Famous Labels is a discounter that feeds on the rejected space of former top brands; no doubt this space once held a Lane Bryant or New York and Company. Notice from the photo above how much of the space inside the store is vacant; the tenant doesn’t even need to stuff the premises with merchandise because rents are low. Stepping back several feet from the store’s entrance reveals its less-than-lucrative surroundings:

Beyond this, many of the other in-line tenants are most likely locally owned and operated. They would never be able to afford the rents in a thriving mall.

The tenant in the background of the photo below is a convenience store, with gas station merchandise. Would you ever see that in a successful mall?

Cortana hasn’t lost all of the big names; a few are hanging on. The neon is barely visible on the photo below, but the two tenants seen here are Pacific Sun and Journeys.

And two more mall mainstays, Hot Topic and Wet Seal:

The targeted demographic for these stores suggests that, at the very least, teenagers still frequent the mall. But how much are you willing to bet that not one of these will renew its lease when the term ends?

And then there’s Aeropostale, another bit of a surprise.

But for some reason, I’ve noticed Aeropostale hangs around dying malls longer than its perceived competitors. I’ve never shopped at the store, but I used to think it was comparable to American Eagle or The Gap; however, those two retailers tend to dart out of a mall at the first sign of failure, while Aeropostale does not. Most likely that means Aeropostale has cheaper merchandise. Bath and Body Works and Victoria’s Secret, both present in Cortana (though I did not take a photo), also hang around longer than one might expect. And shoe stores like Foot Locker are usually among the last big names to jump ship. I enjoy what the property managers of Cortana, creatively named Mall Properties, have decided to do with some of the vacant storefronts:

These TV screens advertise the remaining in-line stores still standing in the mall.

What about the department stores? At its peak, the mall boasted six anchor tenants, an incredible four of which were housed in two-story structures. Today, four occupied department stores remain: Sears, Macy’s, Dillard’s, and J.C. Penney. Mervyn’s closed a few years before the company went out of business in 2008, while Steve and Barry’s prevailed at the mall until near the end of the company’s life; it was defunct in 2009. But what about the surviving anchors? Since anchors typically pay little to no rent in a mall, they have less at stake and can often break even as long as they sell enough merchandise to pay their employees and cover basic operating expenses. But the Dillard’s at Cortana is clearly feeling the pinch. It’s housed in one of the two-story spaces, but the second floor seems to be receding.

The partitions are blocking about 1/3 of the gross leasable space on this level. A conversation with a clerk revealed that they were liquidating the central portion of that floor as well, seen below.

Before long, only the other 1/3 of that floor would remain open. Access to the second floor is already limited, as witnessed by this barricaded escalator.

How much longer before Dillard’s vacates its second floor altogether? And then, of course, how soon before it bids adieu to Cortana Mall?

Perhaps one of the clearest indicators that this mall is a goner is one of the smaller wings leading back to the parking lot.

The theme of this wing seems to be Public Sector.
It houses an Army Recruitment Center, Navy Recruitment, Air Force, and a US Postal Service Branch. No doubt these government agencies wouldn’t be paying the rent at Mall of Louisiana. While I hate to bring the specter of social class into this argument (and certainly don’t want to politicize it), the presence of all these recruiting centers can’t help but recall Michael Moore’s trip to an Army Recruiting Center in his hometown of Flint, Michigan in Fahrenheit 9/11. He recognized that the recruiting centers never appear on the “good” side of town, where the teenaged shoppers are most likely to have college aspirations.

So, on a scale of 1 to 10, with 10 being the highest and most successful, Cortana’s placement is probably about a four or a five. It’s not dead yet, a few strong tenants remain, and some recent news that a Sam’s Club proposes locating at an outparcel on the mall premises offers a whisper of good fortune in this bad economy. But the fact remains that any mall that sinks below about a 7 out of 10 is likely past the point of no return, and what this means for Baton Rouge is the confirmation that the growth patterns are veering further away from the eastern suburbs and more to the southeast, along the I-10 corridor. It makes sense, in a way: living closer to a limited access road such as I-10 (rather than a busy six lane highway like Florida Boulevard) helps the commuter. And Louisiana State University, the true heart of Baton Rouge, already lies to the south and southeast of the city center. But the housing around Cortana Mall—particularly to the immediate south—is still solidly middle class. How long will it remain that way if the families have a blighted mall presiding over them? Will they be able to sell?

The decline of Cortana is more remarkable because it remains a larger shopping center than the successful Mall of Louisiana, which is about 50,000 square feet shy of its predecessor in GLA. But it’s clear that the decentralizing forces in Baton Rouge have long favored the southeast. The northern section of Baton Rouge is overwhelmingly lower income minority. The western suburbs, across the Mississippi River, are mostly working class and growing slowly. The eastern suburbs comprised a middle class boomlet as recently as the early 1990s, but they haven’t been able to compete in desirability of the I-10 corridor. And since the Mall of Louisiana is the second biggest in the state, it has even become an attraction for folks in New Orleans over 70 miles away; it’s proximity to the interstate makes it far more accessible than the Cortana Mall ever was. But the poor folks in the north and west of Baton Rouge have always had a long hike to get to any major shopping; before long, even the sprawling suburbs of the east will have to travel much further to get to any major retail node. The death of Cortana Mall represents the culmination of some of the most lopsided decentralization patterns of any metro region I have seen. It is an apotheosis of Homer Hoyt’s sector theory, in which settlements expand in wedge shaped patterns along principal transportation routes. There’s nothing wrong with this per say, but the problem with most urban growth theories is that few cities actually live up to any of the proposed patterns. But here’s one example that has followed it almost hook, line, and sinker. Maybe that’s just how they do it Down South?


hagetaka said...

Cortana can come back, that part of Baton Rouge is lacking a few services and stores. If Cortana can secure a Trader Joe's, a small movie theather that we don't have here already, It's just so many things that can we done, until it's shut down 100% and the birds move in, I still have faith in it.

AmericanDirt said...

Hagetaka, thanks for posting, and I love your optimism--perhaps that's something more prevalent here in the South. But Trader Joe's has yet to open a location in Louisiana, and as of yet is still rare in the Southeast. Is it likely that such a business, which prospers in affluent, well-educated areas, will ever consider a location near a dying mall? How many of the remaining big-name tenants--Hot Topic, Wet Seal, Aeropostale--are likely to renew their leases when the mall is already half-empty and the department stores are closing off their upper levels?

The goal at this point should be to start thinking about what the next life will be for the Cortana Mall parcel as a whole, so that ideally the conditions and investors will be there, ready to redevelop long before the birds move in.

Kerrie Butts said...

Cortana mall was the destination of the fall back to school shopping trips of my youth. My mom and I would drive a hour from Lafayette. It is a shame these shopping centers have such short lifespans and limited flexiblity. In Hong Kong, I visited Chu Hai College campus which is spread out in failuring retail centers in Tsuen Wan (industrial town/part of New Territories). The library is on the top floor of a mall with 50%occupation and a nursing home on the floor below and the architecture studio is in the next block between a chinese family style restaurant and preschool. I should send you photos, thanks for posting.

Barrett said...

'urbanismbylatitude' either has inside info or was right on time with the Hong Kong comparison:

"The old Service Merchandise/Steve & Barry's anchor store in Cortana Mall has been sold, and plans are to put a private, for-profit college in the space. VC Baton Rouge, a partnership based out of Ridgeland, Miss., bought the store for $1.25 million in a deal that closed Friday....The school will spend between $4 million to $6 million to renovate the space, putting a tenant in a part of the mall that has been vacant since 2009."


Christine said...

I'm seriously fascinated by dying retail, too, but it also fills me with senses of creepiness and sadness at the same time. I went to Landmark Mall in Alexandria, VA a week ago and was really astounded by the change that happened over the course of about 9 years or so. Back then, it was getting a Lord and Taylor (it was not a top of the line retail destination at that time either, so this was a big deal). Fast forward to last weekend, when I went to the Bath & Body Works, which aside from the anchors (Macy's and Sears=long lease...Lord & Taylor long gone) and some cell phone companies are the only national credit tenant. Being there slightly after dark was creepy for the simple reason that there was hardly anyone in the halls. I've encounered this in the past with places I fondly recalled in my youth (Greengate Mall in Greensburg, PA--where I first spent time alone in a mall with my friends...is now gone, to make way for a Walmart Supercenter) and for work in various places.

AmericanDirt said...

Thanks again for the comments, everybody.

Urbanismbylatitude, I would love to see pictures of that mall in Hong Kong--it would be interesting to see how struggling retail corridors evolve (or devolve) in one of the world's most densely populated cities.

As Barrett has smartly observed, many times in the US, a mall that loses its viability for housing retail finds that it can attract other institutional/service-based uses. The new college is great news for Cortana, particularly considering that it is a for-profit use that is far more likely to attract consistent foot-traffic than, say, a church (the ultimate sign of a dying mall). It still isn't likely to shoot much life into the interior of the mall with all the in-line stores, since people are arriving at this new college for purposes other than shopping. But I have seen efforts like this replicated in other cities, where an old department store turns into a library, call center, or a vocational school. It will certainly help the appearance at Cortana and hopefully will prove a sustainable venture. Thanks, Barrett, for pointing this out--your optimism is appreciated.

Christine, thanks for the observations. I don't know much about Landmark Mall, but do you think it was replaced by some lifestyle center further out in the faster growing burbs of Fairfax/Loudon County? Alexandria has such a strong downtown these days, though that clearly attracts a clientele demanding a different shopping experience. How's Pentagon City looking these days? It used to be quite the place a decade ago, though from what I hear these days it has lost some ground and is just a run-of-the-mill mall.

Anonymous said...

Interesting update about Dillard's at Cortana Mall...it's now a clearance center. It's the final resting place of clearance items that Dillard's stores across Louisiana send the merchandise that hasn't sold.

AmericanDirt said...

Thanks for the latest update, Anonymous. I haven't been to Baton Rouge in almost two years; I have no doubt Cortana's decline continues. Last I heard, one of the vacant anchors was being used for a for-profit continuing ed program; any ideas if that's still around?

Anonymous said...

Virginia College is still there as of this evening. Dillard's is still a clearance store with amazing deals, but the second floor is not in use at all anymore. JCPenney, Macy's, and Sears appear to be standing their ground for now. Hot Topic is gone now, but Wet Seal, Victoria's Secret, Aeropostale, Game Stop, Bath and Body Works, The Children's Place, Claire's, Lens Crafters, the typical mobile phone stores, and a few mainstream jewelers remain. Also, your usual shoe stores are staying put for now.

The Sam's Club opened on the outparcel across the street a few months back, so surely that is a bright spot. The Lowe's Home Improvement and Walmart Supercenter on the outparcels continue to thrive.

AmericanDirt said...

Thanks for the latest update on the condition of Cortana. I haven't been to Baton Rouge for about two years. Funny about the Dillard's closing off nearly half of their leasable space. I guess it proves that, in the leasing arrangements for anchor tenants, space is nowhere near of a revenue consideration as other variables. After all, it doesn't save them rental money to operate on one floor instead of two, since they're probably paying little to nothing anyway. It may be that the lights are off upstairs (saving utility costs for the mall management which they pass on to the tenants) and it certainly means fewer employees at Dillard's to staff and monitor all that space.

Anonymous said...

Nice photos and commentary on Cortana. This was the mall where I spent a lot of my formidable years.
Before that, nearby Bon Marche (now closed) ruled the retail landscape. For 10 years, Cortana was THE mall in Baton Rouge.

Back in the 70s and 80s, the mall also had a couple of fountains and waterfalls. One huge anchor store, Godchaux's which was a prominent department store in BR and N.O went under I believe in the mid-80s. This started the slow but steady decline of Cortana. Additionally, there were strip malls surrounding the area. I recently went home for a visit and Cortana is more or less on life support now.

AmericanDirt said...

Always nice to see an occasional update. Thanks, Anonymous from 8 July. I haven't been to BR for a few years, so I wouldn't know Cortana's current condition, but it doesn't surprise me one bit.

What would surprise me is if the mall really began to decline before the construction of the Mall of Louisiana in 1997. Correct me if I'm wrong, but up to that point, wasn't Cortana the big man on campus? With nothing to replace it in terms of retail power, I'd imagine it was the hub of activity until the Mall of Louisiana took the wind out of its sails. When I first visited Cortana back in 2005, it was still pretty busy (except for the Sears wing) even though the writing was on the wall back then.

These days, though, you'd be hard-pressed to find much of any solid retail along the Florida Boulevard corridor--all the way out to the eastern city limits. 95% of Baton Rouge's retail strength is south of Florida Blvd.

Anonymous said...

The decline of Cortana Mall began in 1995/96 with the announcement of the construction of The Mall of Louisiana, it just wasn't apparent visibly. Prior to that, Cortana was the "big man on campus". I worked at Cortana Mall from 1980 to 1996. "Fast Time At Ridgemont High" made the mall the place to be. I started there at the age of 15, almost 16, for a family fast food business to working in the management office. I can honestly say that I loved working there, and met some incredible people during that time frame. We just were not prepared for the competition. I say we, but in really all came down to the property management, Mall Properties. They dictated what was done at Cortana Mall and they just didn't predict the swing in demographics and instead relied on customer loyalty.

We began doing things like creating a Mother's room for nursing mothers, which at the time was different and unique. We also banned smoking inside the mall, which back then felt like a taboo. I think they were looking so closely at the new mall, that they didn't see the closing of Bon Marche Mall and where the people who lived around that area would begin shopping. When the demographics began changing at Cortana, people began pointing out that they didn't feel as safe shopping at Cortana so a change was made to the security department. We added bicycle patrols along with our other security vehicles, and added a state of the art camera system to the entire mall and all seemed to make everyone happy.

With the opening of the new mall, it became clear that the demographic line had shifted way more than was anticipated. It was announced that there was plenty of room for more than one mall in Baton Rouge on the news. I think the problem was that Cortana ended up with the demographics they didn't want. The "original" in Cortana moved to the new mall and allowed their leases to expire because the "money" lived closer to the new mall and were not going to go out of their way to travel to Cortana. Once you drop below a certain vacancy level, then you have to lower your lease rates and your share of the percentage per square foot.

I really liked your article, but at the same time feel very sad at its decline. Its like watching a dear friend decline in health. So many good memories!

AmericanDirt said...

Thanks for your comment. This blog is inactive, but I'm going to repost your comment on the active version of American Dirt (dirtamericana.com) and I will respond to it there as well.

Anonymous said...

The news today is of the closure of one of the remaining anchors, Macy's. The future of Cortana Mall ( I never took the name change to "the Mall At Cortana" seriously)is dim, but there is a glimmer of hope. I cite the incredible rebound of nearby Clearview mall in Metairie. The Dillards and other major department stores bugged out (the Dillards, a Three Story former pre-Goudchaux Maison Blanche) taking the familiar path of first becoming a discount center. The "D" floorplan Sears (THe largest size, larger than either of the two in Baton Rouge) rode out the dead mall period, and the owners spruced up the place, and landed a Target store that was novel in that it was a two story store, and NOT a SuperTarget. As far as I can tell, Clearview is still doing significantly better than it was before Target opened, so there is hope. One key difference is that Cortana's first run movie theater closed early in its life, and Clearview maintained the one there.