Placer.ai Mall Index: February 2024

Looking Back at 2023 

Despite the inflationary headwinds that marked 2023, year-over-year (YoY) foot traffic to Indoor Malls and Open-Air Shopping Centers exceeded 2022 levels every quarter of 2023, with the two shopping center formats competing head-to-head for the top spot: Open-Air Shopping Centers outperformed Indoor Malls during the first three quarters of the year, but Indoor Malls came out ahead during the critical holiday-focused Q4. Ultimately, overall yearly visit numbers slightly favored Open-Air Shopping Centers, which finished 2023 with a 3.0% overall YoY increase in visits compared to 2.9% overall growth for Indoor Malls. 

Meanwhile, Outlet Malls struggled to keep up with the other two formats. This segment saw a 1.6% YoY decline in yearly visits in 2023, perhaps due consumers looking to save on gas expenses and avoid the typically longer driving time required to get to these types of shopping centers. 

Shopping Center Space Bounces Back From the Cold 

Visits to all three mall formats dipped YoY in January 2024, likely due to the extreme cold temperatures that swept through much of the country and to the challenging comparisons to a strong January 2023. 

But YoY foot traffic to Indoor Malls and Open-Air Shopping Centers swung positive in the second months of the year. Visits to Indoor Malls grew an impressive 6.0% relative to the same month in 2023, and foot traffic to Open-Air Shopping Centers increased 3.9% in the same period. The YoY visit gap to Outlet Malls also narrowed significantly, with foot traffic to the format just 1.6% lower than it was in February 2023, indicating that – despite predictions – 2024 consumers are still willing to spend on discretionary categories.

Uneven Comparisons to Pre-COVID Baseline 

While visits to the mall space appear to be generally growing on a YoY basis, comparing the foot traffic performance to pre-COVID visits levels reveals a more nuanced picture. Of the three shopping centers formats, Open-Air Shopping Centers drew closest to pre-COVID levels, with 2023 visits just 1.5% lower than they were in 2019. The visit gap to Indoor Malls was slightly larger, with the format attracting 4.6% fewer visits in 2023 than in 2019. And Outlet Malls appear to be having the toughest recovery, with 2023 visits to the format 9.7% lower than in 2019. 

But just because visits to the shopping center space are still catching up to 2019 levels does not mean that all is lost – a deeper dive into location intelligence data indicates that post-pandemic shopping habits are still in flux. 

Shopping Behavior Still Normalizing 

Analyzing shifts in shopping behavior in recent years reveals that many shoppers are still returning to pre-COVID behaviors. For example, comparing the share of shopping center visits between the hours of 12 PM and 4 PM in 2019, 2022, and 2023 indicates that the “new normal” of mid-day shopping sprees is on its way out. 

The share of hourly visits between 12 PM and 4 PM jumped over the pandemic thanks to consumers’ newly flexible schedules, and mid-day foot traffic to shopping centers was still higher in 2022 compared to pre-COVID. But the relative share of mid-day visits dropped from 2022 to 2023 and moved closer to 2019 levels – indicating that shopping patterns have not yet reached a post-COVID equilibrium. 

Critically, there appears to be a correlation between the return to 2019 shopping patterns and the visit recovery rate. Visits to Open-Air Shopping Centers in 2023 were almost on par with 2019 levels, and the format’s mid-day visit share was only half a percentage point higher in 2023 than in 2019. The mid-day visit share at Indoor Malls, where the year-over-four-year (Yo4Y) visit lag was slightly larger than for Open-Air Shopping Centers, was still 1.9 percentage points higher in 2023 when compared to 2019. And Outlet Malls had the largest Yo4Y visit gap along with the largest Yo4Y difference in mid-day visit share. 

This data indicates that post-pandemic shopping patterns are still dynamic – and even retail sectors that appear to have permanent COVID scars may well bounce back as consumer behavior continues to normalize. 

Shopping Center Space Well Positioned for a Strong 2024 

Despite predictions of slower consumer spending, foot traffic data indicates that demand for malls and shopping centers remains stable. Location intelligence showing strong monthly visit numbers and positive shifts in shopping behavior indicates that the shopping center space is off to a strong start in 2024. 

For more data-driven retail insights, visit our blog at placer.ai. 

This blog includes data from Placer.ai Data Version 2.0, which implements improvements to our extrapolation capabilities, adds short visit monitoring, and enhances visit detection.