RETAIL: U.S. malls are far from dead says RCA senior VP

Do not buy into the story that all malls are being killed off by the Internet, wrote Jim Costello, senior vice president at Real Capital Analytics, in a recent article. The variation in pricing for malls in 2018 shows that there are still valuable assets in the United States.

The story here is that the mall sector is not dead and there is a great disparity in pricing, notes Costello. Retailers often close underperforming stores early each year after the last profits can be taken in the holiday spending spree. The closing of stores is equated with the pricing of some of the worst-of-the-worst assets and used to paint a negative story about the sector overall. However, the market is more diverse, with the best-of-the-best assets rarely trading. The entity-level transactions of 2018 show us that there is still value in this sector.