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25 Largest Shopping Malls in the United States
Habib Ur Rehman
9 min read

In This Article:

In this article, we talk about the 25 largest shopping malls in the United States. You can skip our detailed analysis of the mall industry in the US and go directly to 5 Largest Shopping Malls in the United States.

The State of the Mall Industry

The shopping-mall industry in the US grew exponentially from the 50s as suburban life took hold of the country, raising the demand for local shopping centers. Fast-forward to the 21st century, the Internet ushered the US into the age of online shopping, where you can find and buy pretty much whatever you want from the comfort of your couch. 

This has led to a decline in the shopping-mall appeal. The decline was accelerated during the pandemic lockdowns in 2020 when online shopping grew by 43% according to the US Census Bureau. 

While shopping malls are still one of the major players in the US retail market, online shopping is projected to account for a third of all retail shopping by 2030, per Kearney, a global management consulting firm. On the other hand, The mall vacancy rate has risen to 8.3% as of Q4 2021, according to data from Statista. This has left the mall REITs with the choice to either evolve or die out. 

Rate-Hike Onslaught

To make matters worse, rising interest rates in the US to counter inflation are expected to drive many retailers out of business. Rate hikes are making it harder for consumers to spend money, which is driving the demand for retail goods down. 

In addition, many retailers had tapped into revolving credit facilities in 2020 to stay in business during lockdowns. The amount these companies borrowed accounted for $145 billion of the $252 billion of total credit, and a significant portion of this amount was variable-rate debt, which is expected to be paid back in the next five years.

This means that many retailers would be paying their debt with rising interest rates, at a time when consumers are shopping less. It represents a real risk of driving many retailers out of business, which is further expected to increase the mall vacancy rate through the next five years. Additionally, it’ll make it harder for the survivors to expand their presence in shopping malls. 

Future of Shopping Malls

The situation on the ground doesn’t look good for shopping mall REITs, but there are ways around irrelevance in the long-term future. 

According to a Reuters report, Simon Property Group, Inc. (NYSE:SPG), the biggest mall-owning REIT in the US, is in talks with Amazon.com, Inc. (NASDAQ:AMZN) to turn its vacant Sears and J.C. Penney stores into fulfillment centers. 

Many other shopping malls in North America and Europe are turning towards logistics as the answer to their decreasing revenue in retail. Apart from rising demand for warehouses, logistics also carries financial benefits. The space for retail costs on average $20 per square foot, while the same for warehouse space is only $6.5.

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