How adding condos could help London's once-mighty malls evolve

In the first episode of Season 3 of the Netflix show Stranger Things, the Starcourt Mall is the place to be. 

The parking lot is full, the food court is jammed and kids are queuing up to jam quarters into arcade games.

And while the show is fictional, Starcourt's success is an accurate depiction of a typical suburban mall in 1985: Teeming with people because in the pre-Internet world, it offered one-stop shopping. 

A shopping mall scene set in 2023 would look quite different. There would be fewer people and a lot more vacant shops.

As retail analyst and author Bruce Winder points out, the shopping mall model that once pushed so many downtowns to the brink of ruin is now itself under pressure to evolve or die.  

A main culprit of course is e-commerce. The mall no longer has it all when it comes to shopping. With it now possible to shop online and have the product at your door the next day, the malls have to offer something more. 

"Malls have had to change from where we were in the 1980s," said Winder. "You have to have a reason to bring people to malls now." 

A key change coming to malls — and it's part of a trend that's reshaping London's three largest shopping centres —  is a move to add residential units to the space, including apartments and condos. 

At CF Masonville Place in north London, the city has approved special planning rules for the mall and surrounding neighbourhood that will allow residential towers up to 22 storeys tall. 

At Westmount Mall, which is currently two thirds empty, adding residential spaces with up to 900 units is part of the redevelopment plan. 

Last week Westdell Development Corporation bought White Oaks Mall, with the new owner telling CBC News they plan to add residential units as part of their future redevelopment plans. 

While Westmount is clearly struggling, Masonville and White Oaks appear to be doing well, with parking lots and retail spaces that are full. 

However retail consultant Doug Stephens of Retail Prophet said most mall operators now understand that shopping alone won't ensure their survival. 

"They have these decaying assets that are losing value as more and more retail goes online," he said. "To raise the asset value, these companies are saying 'Well, we have to create mixed-use communities.'" 

While living on a land that includes a mall would seem impossible to mall-goers in the 1980s, Stephens said many people now like the idea of living in a place where they can walk to shop without having get into a car or in some cases, even step outside. In many of the London malls' redevelopment plans, the new residential towers would be built on what are now vast parking lots. 

The mixing of retail and residential also jives with the London Plan, the city's guiding planning document. It calls for greater density on city land and new living spaces where walking, cycling and transit are easier options than driving. The Masvonville plan includes an expanded transit station on site. White Oaks Mall will have a new transit hub as part of the BRT's Wellington Gateway line currently being built. 

Not an easy transition

Stephens said simply adding residential isn't an easy task for companies whose business models have for decades been based on renting out retail spaces. For most mall owners, it will require partners who know the residential market. 

Adding a tower or two of condos or apartments won't be enough to ensure the mall's survival, Stephens said. He recommends that shopping centres go further outside their comfort zone and evolve into "entertainment centres" that offer not only shopping, but experiences such as fine dining, music shows and even art installations.

"They really have to rethink the concept of the shopping centre and not simply build residential units around something that is fundamentally outdated," he said. "The mall used to be where we all hung out, today there's just no draw. That's what they need to address." 

Some London malls have already made moves in this direction. Not your typical mall anchor tenant, the reptile zoo Reptilia moved into Westmount Mall this year after a protracted fight with city hall. 

A key tenant at Masonville is The Rec Room, a chain where you can eat, play video games but also take in a band's performance or comedy show in their performance space.   

Winder said it's unclear exactly what the right mall mall mix will look like as mall operators try to balance shifting trends. 

"Surviving is significantly more complicated now than it was in the retail world," he said. "It's like three-dimensional chess from Star Wars. It's hard to get it right and demographics are changing so much."

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