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Some malls on life support

Remember the days when a trip to the mall was an event? Today, the retail landscape has changed drastically, and some malls are finding it difficult to attract customers.

It's a classic Catch-22 situation: Fewer shoppers cause mall stores to close resulting in even fewer customers.A stark example of this cycle playing out in our own backyard is the Schuylkill Mall near Frackville, today just a ghost of its former glory.Amid great fanfare, Crown American, a development company based in Johnstown, opened the 800,000-square-foot mall near the intersection of Interstate 81 and Route 61 on Oct. 9, 1980. At that time, there were three anchor stores - Sears (relocated from Pottsville), Hess's and Kmart. Crown American also was negotiating with J.C. Penney as a fourth anchor, but the deal never came about. Of the 115 storefronts available, 91 were occupied on opening day.Three years later, Pomeroy's relocated from downtown Pottsville to become the mall's fourth anchor. In 1987, Bon-Ton bought Pomeroy's but now is the latest major retailer to announce that it is closing its Schuylkill Mall store, probably later this year. Phar-Mor, the mall's fifth anchor, opened in 1991, but it, too, is long gone.Pennsylvania Real Estate Investment Trust acquired the Crown American properties in 2003 and sold the mall to Empire Realty four years later. The mall has undergone a tortuous death spiral since then. In June 2016, the property was listed for Schuylkill County Sheriff's Sale in judgment of $27.4 million. The mall was recently sold to NorthPoint Development LLC of Riverside, Missouri, for $2.1 million, which has pretty much sealed the fate of the remaining stores. In 2007, the mall had sold for more than $17 million.NorthPoint representatives met with mall store lessees to notify them that leases would be on a month-to-month basis, and no long-term leases will be negotiated from here on out. This uncertainty has resulted in remaining mall store owners scrambling to reassess their future.The NorthPoint company is known for buying ailing malls and other large properties, then converting them to warehousing or other types of industrial use. Bloomburg Business describes NorthPoint this way: "It operates as a real estate development, management and leasing company and leases industrial, multifamily, senior living and self-storage properties primarily in the central part of the United States. NorthPoint Development LLC was formerly known as Briarcliff Realty LLC and changed its name in 2011."The Schuylkill Mall is one of the company's few acquisitions in the eastern part of the United States, although it does own warehouses in the Highridge Business Park, along I-81 in Cass Township.Aside from the well-known anchor stores, many other familiar names have come and gone, including Chick-fil-A, Arby's, Hallmark, Schuylkill Valley Sports, Jo-Ann Fabrics, Auntie Anne's, Littman Jewelers, Kay Jewelers, Liberty Travel, along with many lesser-known, smaller businesses.The Bon-Ton announcement is the latest dagger in the heart of the mall. Store manager John F. Boran made the disclosure several weeks ago, indicating that the store's 36 employees have been notified of the planned closing, although no date was given. Bon-Ton Stores Inc. had announced that it was planning to close up to six stores this year.So, why are big-box retailers, which anchor malls across the country, having such a tough time attracting customers as they once did.For one thing, retailers have too many stores, especially as more consumers have opted to shop online. The changing demographics of the American marketplace also have shifted dramatically, making suburban mall locations particularly vulnerable to economic forces.A few years ago, big-box locations accounted for more than 10 percent of the retail market. Today, it's a little less than 3 percent. Expect complete mall closures this year. Whether the Schuylkill Mall will be among them remains to be seen. More and more chains are closing underperforming locations. Sears announced last week that it and its Kmart stores are on life support and may not survive.Remember when malls came along and sucked the lifeblood from Main Street stores, turning some central business districts into shells of their former selves? Well, we may be seeing a similar transformation as malls succumb to online buyers and other changing social factors.However this will turn out, it's going to get worse before it gets better.By Bruce Frassinelli |

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