America’s housing shortage has become so dire that politicians are looking left, right, underfoot and downtown to see what we could potentially convert into housing. Almost a decade of underbuilding has resulted in a deficit 3 to 6 million housing unitswhich leads to younger Americans getting together with roommates or family or Wait At buy a house in total.
However, there is a common and underutilized property class that has the potential to drive this number down. Long-suffering retail trade— strip malls, strip malls, dead malls and their cousins — could be converted into hundreds of thousands of new homes nationwide with just a little work.
Converting just 10% of underperforming retail sites into housing could create 700,000 new units nationwide, according to a November report Corporate Community Partner. That’s just a drop in the ocean America’s multi-million dollar housing shortage, it could make a real difference for some communities. In the Boston area, converting just 10% of malls would be enough to absorb all of the region’s population growth for the next decade, according to a 2021 study study by the Metropolitan Area Planning Council of Massachusetts. (A property did not have to be completely vacant to be a good candidate for the addition of housing, and many residential conversions in this study suggest retaining ground-floor retail in the apartment buildings.)
“I think this has tremendous potential across the U.S.,” said June Williamson, a professor of architecture at the City College of New York and co-author of several books on building reuse Assets.
““All of the land already developed for retail purposes, scattered at very low densities throughout the United States, accommodates all types of housing,” she added.
Of course, the ability for profound change does not mean that it will actually occur – and converting retail space into housing presents its own physical and political challenges. Still, there are important reasons why converting disused retail space represents a far more promising solution to the housing crisis than office-to-housing projects, which have proven to be much more expensive and rarer than first thought. And there are important reasons why it currently still has potential and is not really being implemented.
Retail is everywhere
Decades of sprawl-oriented development have led to an oversupply of retail space in the United States. Accordingly, there are 116,000 shopping centers nationwide ICSC (formerly International Council of Shopping Centers). This includes not only large shopping centers, but also downtown shopping centers and smaller centers such as malls.
“Malls are ubiquitous, they’re everywhere, they’re often underperforming,” said Mark Racicot, director of land use planning for MAPC Assets. “In many cases, they already fit into the neighborhood.”
While not all retail is underperforming, many are – and the economic climate makes improvement seem unlikely. According to a 2023 study, around 50,000 stores in the United States are expected to close in the next five years UBS report.
Dozens of shopping centers have already converted to housing. In Irondequoit, New York, a suburb of Rochester, an abandoned Sears building was converted into 157 so-called low-income and senior apartments Skyview Park Apartments; The facility opened in 2022. In Santa Ana, California, a low-rise shopping center became a multi-facility community center 55 apartments. And in Aurora, Illinois, part of it Fox Valley Mall was converted into 304 unitsand another shopping center in Vernon Hills, Illinois, now has 311 residential units. Both developments include shared amenities and retail space, said David Dowell, principal of a national architecture and urban design firm El Doradotold Assets.
“Although it is too early to call it a ‘success,’ the mix of uses will certainly make these luxury offerings more attractive,” says Dowell.
By 2022, nearly 200 malls across America would have plans to add residential units Orange County Register; 33 had made these plans since the start of the pandemic.
Office conversions are difficult – but less so in retail
For a moment in the early post-pandemic era, offices seemed like the panacea to solving the housing crisis. Remote and hybrid work led to a huge glut of unused office space – for example 1 billion square meters around the turn of the decade – and some began to think about repurposing this empty space as living space.
But the flood of office conversions was more of a trickle. According to a July 2023 study, only about 30 office-to-residential projects came online each year between 2016 and 2021 Deloitte Study. And at the time of the study there were only 217 such conversion projects in the immediate pipeline.
“If you look at what has been remodeled since 2016 and even what is scheduled to be remodeled by 2025, that’s only 90 million square feet,” Julie Whelan, global head of user research at CBRE, said previously Assets. “The renovations that have taken place and are currently underway are actually just a drop in the ocean given the vacancies.”
Why aren’t developers and politicians doing more to promote such conversion projects? This is because they are often even more expensive and time-consuming than new buildings. In fact, a February report from Goldman Sachs says The purchase prices for offices would have to fall by almost 50% that these projects are “financially feasible” given how much preparatory work they require and the high prices for office space. Stationary retail also suffered from the pandemic and the associated boom in e-commerce. However, unused retail space is often easier to convert into living space than empty office buildings.
Most mall redevelopments do not eliminate retail entirely, but rather incorporate retail, housing, and other types of uses in a limited space. That’s in line with developers’ current focus on creating so-called “18-hour neighborhoods,” or live-work-play centers, where residents essentially get the most bang for their buck. In other words, they can live in the same place – or very close – where they shop and work without spending extra money on travel. It is also good business for the other retail stores, which benefit from the increased footfall in the area.
And vacant malls may be better suited to these developments than office buildings because the infrastructure to support these mixed-use spaces already exists in retail centers, said Kurt Volkman, associate director of national architecture, engineering and planning firm HED Assetsas shopping centers often have existing infrastructure such as parking and access to public transport.
“Now these spaces present an opportunity for redevelopment as their large floor areas and location at the far end of the retail district provide flexibility to convert to residential, entertainment or commercial space,” says Volkman. “Developers who recognize the opportunity and transform retail centers built for a different era into mixed-use spaces that meet today’s challenges will transform retail for a more profitable future.”
Plus, retail locations simply have more space. The design of a shopping center often features vast amounts of empty concrete – one or more large, low-rise buildings surrounded by expansive parking lots. For this reason, it can be relatively easy for a developer to simply add more buildings to a project by building on excess parking, City College’s Williamson said. Existing retail stores can be converted into medical practices, offices or apartments.
And mall-to-housing conversions can happen much more quickly than new construction, “since there is already an existing developed structure on a site that is already approved for at least one type of development,” Dowell says.
“The developer doesn’t have to look for a plot of land to build on or get permits for construction, cutting down trees and the like,” he says. “The biggest time issue will be getting the redevelopment plan approved by local authorities.”
Not everything is going smoothly
However, shopping center redevelopment projects come with their own set of disadvantages in addition to time challenges. While the open floor plan of these buildings allows for more flexible design, lighting and utility work can become an issue depending on the property.
As malls have been built with fewer windows, this would need to be “addressed through architectural interventions” as living spaces must provide a certain level of window-to-floor ratio so that residents receive natural light throughout their unit, says Dowel.
“Residential homes also require plumbing, electrical, heating, cooling and ventilation systems, as well as other types of infrastructure such as Wi-Fi or cable television services,” says Dowel. “While a shopping center will have these, they are unlikely to be easily adaptable to residential use, requiring significant upgrades and changes.”