In an era where e-commerce continues to expand and physical retail faces ongoing challenges, traditional malls are often viewed as a fading relic. But recent data tells a more nuanced story—especially for top-tier malls.
Monthly visits to Class A malls held steady last year, with some even seeing slight gains. This contrasts sharply with the performance of lower-tier malls. Between 2019 and 2024, foot traffic at Class A malls dipped just 2.5%, while Class B and C malls experienced a much steeper 13.2% drop.
Meanwhile, neighborhood, community, and strip centers (NCS) have adapted well to shifting consumer preferences, embracing features like curbside pickup and drive-thru lanes. These centers recorded a 2.6% increase in foot traffic over the same five-year span.
From 2023 to 2024 alone, Class A malls saw a 1.7% uptick in visits, outperforming Class B malls, which saw a 0.7% decline, and closely mirroring the 1.6% growth at NCS locations. Early 2025 figures show continued momentum, with mall visits rising 1.8% year-over-year in March, even as open-air shopping centers posted a 1.1% decline, according to Placer.ai.
Occupancy trends also reveal a significant split. Since 2017, Class B malls have seen occupancy drop by 580 basis points to 90%, and Class C malls have fallen even further to 84%. In contrast, Class A malls are holding strong at approximately 94% occupancy—a relatively modest decline of 440 basis points.
This divergence is being driven by retailers consolidating their physical footprints and focusing on more efficient, high-performing locations. Many brands that once relied heavily on traditional malls are now shifting toward open-air formats, but Class A malls remain a top choice due to their stronger traffic and sales performance.
A lack of new development has also helped support occupancy and rent levels. Since 2010, less than 24 million square feet of new mall space has been added nationwide. Annual asking rents for Class A malls have surged as a result, climbing from just over $24 per square foot to nearly $33 in 2024—a 36% increase.
Looking ahead, experts recommend strategies like greater personalization, retailer-mall collaboration, the use of AI to enhance the shopper journey, and ongoing reinvestment to sustain this positive trajectory. While the retail landscape continues to evolve, Class A malls appear well-positioned to adapt and thrive.
Source: GlobeSt.