Nearly 11,000 stores — owned by traditional retailers like Sears, Walgreens and Gap — are anticipated to close before the end of the year, as the US sets a new record for lost retail space.
2018 will likely surpass last year’s record 105 million square feet (9.8 million square meters) of stores lost, the commercial real estate services firm CoStar has predicted.
The mass closings phenomenon began in the early 2010s as a result of the growth of online shopping, but the sudden pace of the closures has been billed by the US media as a “retail apocalypse.”
A similar story is unfolding in Britain, where the media regularly forecasts “the end of the High Street.” Some 5,800 stores shut down in the UK in 2017, and around 10,000 are expected to close before the end of the year, according to the UK Centre for Retail Research.
Skeptics have long bemoaned that as the legacy retailers abandon their stores, many UK town centers have become cluttered by thrift stores (charity shops), bookmakers and “everything for a pound” stores. But now even the big discount chains are struggling. Just recently, Poundworld went into administration, which could potentially see its 335 stores shuttered.
The incredible growth of e-commerce in both the US and Britain, and the failure of the long-established brick-and-mortar retailers to adapt, has meant mass store closures can no longer be delayed in the name of reputation protection.
“Closing swathes of stores is no longer seen as the characteristic of a retailer on the brink of failure, and this has encouraged more retailers to announce the shutdown of underperforming stores,” Deborah Weinswig, founder and CEO of the New York-based Coresight Research, told DW.
In the US, JC Penney and Macy’s are among the big names to announce the shrinking of their retail portfolio, while in Britain, respected brands including Marks and Spencer and Mothercare are to shed stores in order to bolster profits.
Some retailers have even declared bankruptcy to pressure mall owners and other landlords to renegotiate their rents.
Weinswig cited data from research firm RetailNext showing US shopper traffic fell by nearly 8 percent in 2017, something she said was felt most sharply across specialty and larger-format stores.
Those large US malls (regional malls) that draw in consumers from a 25-50 mile…