Shopping centers have been hit hard in Hampton Roads.
Macy’s closed three area stores in 2016. So did Sports Authority, after filing for Chapter 11 bankruptcy.
And for Williamsburg Premium Outlets, there’s a new competitor on the scene: Norfolk Premium Outlets, which opened June 29.
What does this mean for the traditional malls of Hampton Roads? The answer may not be what you think.
“I’ve been hearing [about] the demise of the malls for literally decades,” said J. Andrew Hansz, a real-estate professor at Old Dominion University’s Strome College of Business.
Lifting all boats
At least ten shopping centers, from Chesapeake Square to the Town Center of Virginia Beach, sit within a roughly 50-mile radius between the Norfolk and Williamsburg Premium Outlets. Both outlet malls are operated by Simon Property Group L.P.
For one shopping-center manager, the Norfolk outlets are an opportunity to reach more customers — not a threat to existing sales.
“Here’s how we look at it,” said Jim Wofford, general manager of Norfolk’s MacArthur Center, 300 Monticello Ave. “The rising tide lifts all boats.”
A Southside retail developer struck a different note, saying outlet stores cater to a low-price customer.
“I don’t see it as being necessarily in the mix of the traditional retail environment,” said Gerald Divaris, chairman and CEO of Divaris Real Estate Inc., which manages Virginia Beach Town Center, 222 Central Park Ave.
Retailers are, however, in a state of transition, with Amazon and e-commerce disrupting the industry. And competition from e-commerce is heating up.
During the first quarter of 2017, estimated e-commerce sales rose by 4.1 percent over the fourth quarter of 2016 — and by almost 15 percent from the first quarter of 2016, according to the U.S. Census…