With retailers going out of business and closing doors, malls are rethinking their assortments, adding non-retail uses such as medical facilities, and, now, coworking spaces.
Mall owner, operator and developer Macerich on Wednesday said it has struck a national partnership with Industrious, a workplace platform and coworking solution provider.
Coworking areas have existed at malls such as Westfield San Francisco Centre, where Bespoke targets retail-tech entrepreneurs with shared desks, dedicated desks, private offices and meeting rooms. Lord & Taylor in October sold its Fifth Avenue flagship to WeWork for $850 million. The retailer’s parent Hudson’s Bay Co. and WeWork Property Advisors earlier this month said they are adjusting their deal for the building and pushing back the closing date to Nov. 13 from Aug. 10. Beyond Lord & Taylor, WeWork is reportedly also gaining access to Hudson’s Bay’s 61 million-square-foot portfolio. WeWork also opened collaborative office space at the Shops at Clearfork, a Simon property.
According to the Global Coworking Unconference Center, the number of coworking members will grow from 1.74 million in 2017 to 5.1 million in 2022, while the number of coworking spaces will increase from 17,725 this year to 30,432 in 2022.
The first Industrious location in a Macerich mall will be a 32,000-square-foot space that’s scheduled to open in January at Scottsdale Fashion Square, a 1.8 million-square foot super-regional property. “This is an evolution in the DNA of the merchandise mix of a shopping center,” said Michael Guerin, senior vice president of leasing at Macerich. “These coworking concepts match the sensibility of how people want to work — creative spaces with amenities and flexibility. We’ve focused on how the landscape is changing for shopping centers.“
“Macerich is on the cutting edge when it comes to adding exciting, traffic-driving new uses to our retail properties across the country,” said Art Coppola, chief executive officer of Macerich. “Our settings deliver top-tier, built-in amenities for today’s professionals, which is why a partnership with experience-focused Industrious makes so much sense.”
Industrious will be taking over a portion of Barneys New York’s 90,000 square feet of space, which became vacant when the retailer in 2016 closed its store. Scottsdale Fashion Square’s luxury wing is creating an enhanced luxury presentation that will include a new entrance flanked by 50,000 square feet of new food options. There will be two-level facades for some tenants, and a new 15,000-square-foot anchor that Guerin declined to name will open. “For the first time, the project will have a true sense of arrival,” he said.
Guerin pointed out that Cartier and Gucci are building new stores, Louis Vuitton recently remodeled its store, and Saint Laurent will open its first Arizona location. “It’s the composition of the merchandise mix that’s being enhanced,” he said. “Industrious makes sense for Scottsdale Fashion Square because it’s one of the fastest-growing markets and has a mature, affluent customer. There’s also a booming tech industry that’s driving a younger, upwardly mobile consumer, tourists and snowbirds with second homes. We have top-performing Nordstrom and Neiman Marcus stores.”
“We’re making further investments in the shopping center,” Guerin said. “This about the evolution of the merchandise mix, the elements and facets of lifestyle. The mall isn’t dead and this isn’t the mall filling space. We’re 90 percent occupied.”
“We’re thrilled about the partnership,” Guerin added. “Industrious has over 40 locations. They’re innovative and forward-looking. We’ve focused on how the landscape is changing for shopping centers. You’ll see Industrious at many of our centers. That’s what’s transformational about how people are looking at their work space.”