Two Malls Shut By The Pandemic: One Empty, One Busy, Thanks To Target, Whole Foods

Here’s a tale of two malls, half a mile apart, in still-locked-down New Jersey.

One was busy this Saturday, with cars jockeying for parking spaces and shoppers rushing into stores.

One was not. Its parking lots were deserted, with almost all of its 10,000 parking spaces empty.

One has a Target
TGT
and a Whole Foods, and one does not, and that makes all the difference.

The coronavirus crisis has upended the rankings list of the marquee, most-in-demand mall tenants.

The deserted mall was Westfield Garden State Plaza in Paramus, New Jersey’s largest mall. (American Dream doesn’t count yet because only a small part of it is finished). For the past 25 years, Garden State Plaza has been the most sought-after location for high-end department stores looking to establish a beachhead in affluent Northern New Jersey, where there is no sales tax on clothes, and which is close enough to Manhattan to draw lots of New Yorkers.

European luxury brands, and direct-to-consumer startups looking to open their first U.S. stores picked the Plaza as the perfect mall to test their retail concepts.

Garden State Plaza replaced its aging Gimbels with one of the first Nordstrom
JWN
stores on the East Coast, and built a new wing to add a Neiman Marcus and a best-in-class Lord & Taylor.

Now, Lord & Taylor reportedly is preparing to liquidate all of its stores as soon as they are allowed to reopen them, Neiman Marcus has filed for bankruptcy, and Nordstrom is closing 16 stores (but not the one at the Plaza).

All of those large anchor department stores at the Plaza were closed Saturday, and the huge parking lots around them were empty. Half a mile east on Route 4, the highway that borders both malls and links them to the George Washington Bridge and Manhattan, there were traffic jams at Bergen Town Center.

Like Garden State Plaza, most of Bergen Town Center was closed on Saturday, but the traffic was being generated by the two large anchor stores thatwere open at either end of the mall, Target and Whole Foods.

Having a supermarket, or a Target, Walmart
WMT
, or Costco, all of which have been allowed to remain open because they sell food, has become a bigger mall status symbol, and survival tool, than having a Saks, Nordstrom, or Neiman’s.

Another challenged Paramus Mall, Paramus Park, replaced a vacant Sears last year with a supermarket, Stew Leonard’s, that has proven to be a lifeline for the mall during the crisis.

Garden State Plaza was hailed for its leasing coups when it signed Nordstrom, and Neiman Marcus, and an AMC multiplex movie theater, but Bergen Town Center now, in the pandemic era, gets credit for the ultimate leasing win when it landed Whole Foods in 2005.

Bergen Town Center, then owned by Vornado Realty, and now part of the Vornado spinoff, Urban Edge Properties, was viewed as a dying outlet mall before the arrival of Target and Whole Foods.

Garden State Plaza and Bergen Town Center (then called Bergen Mall) opened within six months of each other in 1957, and in the beginning offered near identical mall experiences, and competed for the same kinds of tenants.

In recent decades, the Plaza has shifted to more of a luxury and destination model, while Bergen Town Center has focused on everyday shopping.

Garden State Plaza was an in-demand mall for retailers because of its ability to consistently draw crowds. Now, as crowds are something to be avoided, and regulated, Westfield faces the challenge of rapidly reinventing the mall.

Its restaurants have been offering curbside pickup during the shutdown, but on Saturday the only one that was busy was Shake Shack, which had half a dozen people waiting in line at its outdoor pickup station.

Westfield, ever since it acquired Garden State Plaza in 1986, has been brilliant at spotting mall trends before anyone else did.

It began planning few years ago for a tsunami of change that was expected to hit malls due to changing shopping habits. Last year it unveiled a plan to build apartment buildings, offices, and outdoor parks and community spaces in the parking lots that surround Garden State Plaza. That redevelopment most likely will include everyday tenants like retailers and coffee shops.

While Westfield failed to foresee the current essentials-only mall crisis by bringing in a grocery tenant like a Whole Foods or a Wegman’s five years ago, it did design the Plaza to make it well-suited for the newest coronavirus-related retail change – curbside pickup.

As Westfield has added anchor stores and redeveloped the mall over the last 20 years, it has given those new anchors, and existing anchors like Macy’s
M
, spacious entrances connected directly to parking lots. Those entrances are perfect for curbside pickup, if customers end up using curbside pickup at Neiman Marcus, Nordstrom, or Macy’s.

And Garden State Plaza, these days, has lots of empty parking lot space surrounding the mall where the other 200-plus retailers inside the mall could set up curbside stations if they need them.

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