The site of one of the so-called retail apocalypse’s most potent symbols will be reborn as a linchpin of digital commerce: the fulfillment center.
The Akron Beacon Journal/Ohio.com first reported that the site of the former Rolling Acres Mall, which fell into disrepair when it closed doors in 2008 and was razed by the city of Akron in 2016, is under new ownership as Amazon transforms the desolate acreage into a 695,383-square-foot fulfillment facility designed to quickly ship goods to customers in the region and along the East Coast corridor.
The projects joins a similar effort underway that sees the former Euclid Square Mall in Euclid, Ohio, gaining new life as a warehouse for Amazon that’s scheduled to open this year. Amazon reportedly paid $7 mall for the has-been mall and buildings nearby.
Amazon converted yet another notable Ohio shopping center into a 2-million-square-foot e-commerce fulfillment center that began operations in August of last year. Closed in 2009, the Randall Park Mall once housed 200 stores, including seven anchor tenants, and at one point had earned the distinction of being the world’s largest shopping center.
Growing its network of national fulfillment centers is key to Amazon’s ability to meet growing demand from valuable Prime customers for Fulfillment By Amazon products that ship in two days, next day, same day or in as little as an hour. Amazon grew its logistics square footage by 30 percent over 2016 and 2017 and by 15 percent in 2018, investor relations director Dave Fildes said in the company’s latest earnings report.
Amazon is just one of many businesses seizing the opportunity to breathe new life into the hollowed-out hulks of once-bustling shopping centers as consumer behavior sees clicks muscling out bricks on the convoluted path to purchase. Research from CBRE describes this “conversion trend” as a “niche” area of the market that’s growing steadily, thanks to strong demand and low vacancies in the warehouse sector coupled with years of store closures by big-box retailers.
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David Egan, CBRE’s global head of industrial & logistics research, noted that nearly every market nationwide is ripe for this kind of real estate transformation. “But many conversions are more challenging to execute than it might seem, given that the developer-owner of each site often needs to get a wide group of stakeholders to agree on a fairly dramatic change,” he explained.
Many of these previously “unthinkable” redevelopments are now “gaining traction,” and that signals good news for the warehousing sector, Adam Mullen, Americas leader of CBRE’s Industrial & Logistics business, added. “That industrial uses can overtake what are usually higher-rent uses illustrates the strength of demand for industrial real estate, especially last-mile distribution centers.”