Our 26th President was one of the best and a strong leader as evidenced by his adornment on Mount Rushmore. “Speak softly and carry a big stick” is Roosevelt’s best known quote, but my favorite is: “In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing.”
Powerful. And what are many owners of B and C Malls doing? Nothing. Fear has forced many mall owners into inaction. Their feeling is it’s better to maintain the status quo than to take a risk and try to improve their center. The Internet, bankruptcies of national retailers, the lack of expanding retailers and the uncertainty surrounding the mall model have led some mall owners to sit still and do nothing. This wait-and-see-attitude is not an option. We’re out of time.
Redeveloping or re-positioning a mall is not easy. There is uncertainty surrounding the future viability of a mall and capital needs to be deployed wisely. Evaluating which retailers will survive and thrive during these times is an art, not a science. Operating a mall or center experience downward pressure on rents is challenging.
Still, we must press on. We must quickly evaluate alternatives and do the right thing — make a decision. Delaying a redevelopment or re-positioning decision could be perilous. Foregoing that deal with a traffic-generating retailer due to below proforma rent could begin your mall’s downward slide. Putting that sponsorship deal on hold because you are not entirely sold on the sponsor may not be wise. Over-analyzing the lower rent renewal deal on the table may make your tenant walk.
Above all, remember the Internet and the new project up the street skews the position of leverage to the retailer, making doing nothing not an option. In turbulent times, mall owners need to make decisions. Doing the right thing is obviously the best course of action. Making wrong decisions is the next best thing. You will be able to learn and course correct. If you make enough decisions, you will make many right ones and create some momentum for your mall or center. Doing nothing could lead to your mall’s demise.