Placer.ai Mall Indexes: July 2022 Update

About the Placer.ai Mall Indexes: These Indexes analyze data from more than 100 top-tier indoor malls, 100 open-air lifestyle centers (not including outlet malls) and 100 outlet malls across the country, in both urban and suburban areas. Placer.ai uses anonymized location information from a panel of 30 million devices and processes the data using industry-leading AI and machine learning capabilities to make estimations about overall visits to specific locations. 

When we last looked at the Placer.ai Mall Indexes, a clear decline was taking place, driven heavily by high gas prices and continued inflation. Yet, at that time there was also an expectation that July could be even worse, in particular because of continued economic headwinds and in comparison to a very productive July 2021.

Yet, the result was far more positive than expected.

Year-over-Year Visit Gaps Relatively Small

July did see year-over-year (YoY) visit gaps for all three indexes marking the first time in 2022 that indoor malls and open-air lifestyle centers saw YoY declines. There was also a minor increase in the visit gap for outlet malls which had been feeling the unique pressure of gas prices that disincentivized the longer trip normally needed for a visit to an outlet mall. 

However, all of these YoY declines were relatively small, especially when considering the unique heights that were hit by the three mall segments in July of 2021.

The relative success comes into sharper view when looking at the segment compared to the equivalent periods in a pre-pandemic 2019. From this perspective, visit gaps actually shrunk to their smallest since April 2022 with indoor malls down just 3.5%, open-air lifestyle centers down just 2.7% and outlet malls down 7.0%. Critically, this marked significant contractions of the visit gap compared to June.

And the signs of positive momentum didn’t end with the year-over-three-year (Yo3Y) comparison. Indoor malls, open-air lifestyle centers, and outlet malls also saw substantial month-over-month (MoM) traffic increases with outlet malls seeing a massive 23.4% jump. 

So where does this leave malls heading into August?

First, expect the YoY gaps to continue to improve as the comparison shifts from the powerful heights hit in July 2021 to an August 2021 that was limited by the spread of the Delta variant. Second, decreases in gas prices are a significant factor that could help drive value for all three segments, but especially outlet malls. Outlet malls are well positioned to help address inflation concerns with their value orientation, and if gas prices continue to decline, the opportunity for a strong end to the summer is significant. 

Finally, looking at the relatively minor declines in July compared to 2019 indicates that the rebound that many top-tier malls have been enjoying could continue and even pick up pace heading into the holiday retail season. If this holds true, the lack of a true brick-and-mortar retail holiday season in 2021 combined with the more holistic experiences that these centers are built to provide could create a major draw even amid lingering economic concerns. 

Can the different mall segments continue to rebound? 

Visit Placer.ai to find out.

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