Downtown Shopping Malls Are Ripe For Expansion

"The Westfield San Francisco Centre on Market Street is tripling its size at a time when urban malls are tapping into the revival of downtown shopping

Westfield, in partnership with Forest City, is adding 1 million square feet of retail and office space to its shopping center in the middle of San Francisco's retail district.

As more people come downtown to spend their dollars instead of retreating to the suburbs, retailers have been responding by opening flagship stores in urban malls and putting their smaller, satellite stores in outlying areas.

Although the cost to operate a store in an urban mall is much higher than in a suburban mall, the payoff can be far greater. Anita Kramer, director of retail development for the Urban Land Institute, said retailers are willing to pay a premium to gain access to the high volume of foot traffic downtown.

Older cities are employing the same strategy used in the suburbs to win back shoppers, creating malls by clustering stores under one roof, mixing in office space and entertainment to increase foot traffic."

In addition to Bloomingdales, Westfield S.F. is opening a nine-screen movie theater and a gourmet market, along with shops and restaurants.

"Although Los Angeles, Chicago and New York have successful urban malls, not all cities are equipped to handle them. Nina Gruen, principal sociologist of market research and analysis at Gruen and Associates, said there are a number of factors that play into a customer's willingness to shop downtown. For instance, there must be a perception that the area is safe. There must also be other activities to hold the customer's interest.