Still, malls continue to struggle nationwide

By Shereen Siewert

WAUSAU – Teen clothing retailer Rue 21’s Wausau Center store is not on a list of planned closures, Wausau Pilot & Review learned Monday.

The Pennsylvania-based chain, which had been the subject of bankruptcy rumors, announced on Monday a plan to shutter about 400 stores. The closures represent more than a third of the chain’s 1,100 locations in malls, outlets, and strip centers across the U.S.

So far, however, the Wausau Center store appears to be safe, though the mall has suffered a series of recent closures. Vanity in March announced it would close all its stores including the Wausau location, followed by Payless, which made a similar announcement in early April. Major retailers have also pulled out of the mall, including anchor stores Sears and J.C. Penney.

If Rue21 indeed files for bankruptcy this month, it would join a long list of retailers doing so in recent months, including Gordmans, RadioShack, Gander Mountain, BCBG Max Azria, MC Sports and The Limited.

With this month’s Chapter 11 filing by Payless, the number of retailers going bankrupt in 2017 has already surpassed the volume of similar bankruptcy filings from all of 2016, according to The Consumerist.

Wausau is not alone in its mall struggle. From rural strip-malls to Manhattan’s avenues, it has been a disastrous two years for retail. There is no question that the most significant trend affecting brick-and-mortar stores is the relentless march of Amazon and other online retail companies. But the recent meltdown for retail brands is equally about the legacy of the Great Recession, which punished logo-driven brands, put a premium on experiences (particularly those that translate into social media moments) and unleashed a surprising golden age for restaurants.

So, what’s up? Travel is booming. Hotel occupancy is booming. Domestic airlines have flown more passengers each year since 2010, and last year U.S. airlines set a record, with 823 million passengers. The rise of restaurants is even more dramatic. Since 2005, sales at “food services and drinking places” have grown twice as fast as all other retail spending. In 2016, for the first time ever, Americans spent more money in restaurants and bars than at grocery stores.

There is a social element to this, too. Many young people are driven by the experiences that will make the best social media content, whether that includes a conventional beach pic or a well-lit plate of glistening avocado toast.

These sorts of questions (“what experience will reliably deliver the most popular Instagram post?”) really does drive the behavior of people ages 13 and up, and that can be a big deal for malls, says Barbara Byrne Denham, a senior economist at Reis, a real-estate analytics firm. Department stores have failed as anchors, but better food, entertainment, and even fitness options might bring teens and families back to struggling malls, where they might wander into brick-and-mortar stores that are currently at risk of closing.

The malls that survive, experts say, will have to better understand the changing needs and wants of the communities they serve.

Wisconsin Rue 21 stores closing:

  • Crossroads Commons
  • 1170 Meridian Drive
  • Plover, WI 54467
  • Shoppes at Fox River
  • 1160 West Sunset Drive (suite 128)
  • Waukesha, WI 53189
  • Marinette Commons
  • 2910 Roosevelt Road (suite D)
  • Marinette, WI 54143
  • Target Outlet Center
  • 652 N. Edwards Boulevard
  • Lake Geneva, WI 53147
  • Germantown Plaza III
  • N96W19140 County Line Road
  • Germantown, WI 53022
  • Corporate Center
  • 1331 W Paradise Drive
  • West Bend, WI 53095
  • Midtown Center
  • 4184 N 56th Street (suite 38)
  • Milwaukee, WI 53216