Does the Mall Still Have It All?
Evolving consumer habits have forced malls to find ways to reinvent themselves or slowly fade away.
Retail changes fast. Products and brands boom or fall out of favor with shifting consumer tastes and trends. Spending follows the ups and downs in employment and income. Retailers respond with new store formats. Warehouse clubs, combo general merchandise and grocery supercenters, and category-killer big-box chains were added to the retail landscape. Online shopping upended the entire brick-and mortar paradigm. Through it all, the shopping mall remains a persistent presence on the land.
Texas was an early host to these retail titans, with Big Town’s 1959 opening in Mesquite. Within a generation, though, the mall-building boom passed, leaving every Texas Metropolitan Statistical Area with an indoor mall and dozens of such centers in the major metros. By bringing multiple stores under one roof, scale and convenience helped malls endure. They have also benefited from sentiment, reinforced in popular culture. Most people can recall picking up a tuxedo or prom dress, going family holiday shopping, or meeting friends at the food court.
The mall’s golden era was brief. Fickle retail trends, economic stress, and overbuilding impacted most malls. Some closed while others lingered in retail limbo, remaining open with lower-profile tenants and many boarded-up storefronts. A new term, “dead mall,” entered the vernacular. These formerly vibrant retail hubs are malls that lost department store anchors. Without the anchors, customer traffic fell, and the remaining smaller stores began to fail. Some pronounced the mall dead, but today, most Texas metros retain their malls, and larger cities still have many healthy malls.
To get a better understanding of the fate of Texas’ largest shopping malls, you have to take a closer look at national trends, local market changes, and site-specific factors that played a role in some malls dying and most surviving.
Retail Trends
Consumer spending, a function of total population and income, drives retail investment, and in the last 30 years, shopping habits have changed. Adjusting for inflation, since 1995, households spent less at food and beverage, electronics and appliance, and general merchandise stores. These vendors saw sales fall 4.2, 1.9, and 1.8 percent, respectively. Over the same period, by far the largest increase was with “non store retailers,” which includes online shopping firms. Total spending increased 13.2 percent for these remote vendors. The second largest spending gain was for restaurants and bars, with a 3.8 percent increase. General merchandise stores include department stores, the primary anchors of shopping malls. Their spending loss over the period has been a key factor in the weakening and death of many malls.
Source: Texas Real Estate Research Center analysis of U.S. Census Bureau data
Competing retail formats sapped vitality from mall anchors (Figure 1). In 1995, annual inflation-adjusted, per-capita spending at department stores was nearly $1,600. That year, the two future major competitors (warehouse stores and online retail) earned a fraction of those sales. Spending per person was $500 at warehouse stores and $400 with online retailers. Over the decades, the steady decline in department stores was matched by consistent growth in competing formats. By 2024, spending at department stores had fallen to $116, a 93 percent decrease. At the same time, warehouse stores saw a 344 percent increase in per-capita sales, and per-capita online retail spending grew 885 percent. These trends have direct implications for the performance of the associated real estate asset.
Changes in Real Estate Performance
Retail inventory, occupancy, and asset value have responded to spending changes. Statewide store performance data is available starting in 2007, and by this time, many dead malls had already failed. This data tends to reflect better performing centers. In 2007, malls claimed a larger share of Texas retail space than they did nationally. Dallas-Fort Worth, Houston, and San Antonio had 7.5, 8.2, and 9.2 percent of their stores in malls, respectively. Austin was an exception with 5.2 percent. By the summer of 2025, the situation was the same nationally, but malls lost inventory share in all major Texas markets.
Major retail center occupancy rates exceed 90 percent nationally and in Texas Still, malls underperformed in this metric (Figure 2). From 2007, mall occupancy fell nationally and in most of Texas’ major markets. Occupancy was down 1.6 percent in DFW and San Antonio and down 2.6 percent in Houston. Austin malls saw a 1.7 percent increase, likely from a lower retail inventory and much faster population growth.
Source: Texas Real Estate Research Center analysis of CoStar data
Power centers, which include warehouse stores and a mix of big-box “category killers,” enjoyed increased occupancy. In a low-margin business like retail, even small occupancy changes can impact the value of an asset. Indeed, Texas malls have lower per-square-foot valuations than retail overall. Encouragingly, however, for Texas mall owners, this has improved some. In 2015, per-square-foot mall space was valued at 86 percent of the overall retail average. By the summer of 2025, they had risen to 91 percent. These national and local market trends tell part of the life and death stories of Texas malls. Site specific factors can be more important.
Mall Characteristics
Texas has 36 malls with at least one million square feet of retail space (see table). Ten malls are classified as dead and 26 are still active. A mall does not need to be demolished or even closed to be considered dead. Malls that have lost most of their traditional department store anchors and inline national chains are considered dead in this analysis
Note: Because of a lack of inconsistent data on rentable versus gross square feet, malls attributed to have approximately 1MSF were included.
Source: Texas Real Estate Research Center
DFW has the most dead malls with six. Three are in Houston and one is in San Antonio. Of the 26 surviving malls, nine are in the Houston area, nine are in North Texas, and eight are in Central/South Texas (San Antonio, Austin, and Corpus Christi). Dead malls were open for an average of 35 years. Their openings ranged from Six Flags Mall (Arlington) in 1970, to The Shops at Willow Bend in 2001. The most recent closure in our sample occurred in June 2024 (Greenspoint Mall, Houston). The oldest survivor, Northstar Mall in San Antonio, opened in 1960. Since mall architecture has evolved, it may come as no surprise to discover that half of the dead malls opened in the 1970s, while less than a third of the survivors opened in that decade. Almost 60 percent of surviving malls opened after 1979. Newer malls likely accounted for many lessons learned and installed more dramatic features and modern amenities. In addition, half of dead malls made substantial redevelopment efforts. In contrast, 98 percent of survivors saw major renovations or expansions. Staying fresh contributed to their success.
Dead and surviving malls also differ in physical attributes. On average, the dead malls are smaller, averaging 1.2 million square feet compared to 1.4 for the surviving malls. Interestingly, the dead malls had more traditional department stores, 4.7 versus 3.9 for the surviving malls. Typical department store anchors averaged 150,000 to over 200,000 square feet. Thus, the dead malls had more of their leasable space dedicated to a declining retail model and less space for smaller inline stores. The variety available from having numerous small stores may contribute to the relative attractiveness of surviving malls.
Local Market Conditions
Most malls were built between 1970 and 1990 at the edge of urban areas. As these hinterlands filled in with suburban development, the population and income growth rates slowed (Figure 3). Few malls were built in the last two decades as competing retail models, like power centers and online shopping, met many consumer needs.
Source: Texas Real Estate Research Center analysis of U.S. Census Bureau data
Even under slowing growth conditions, the surviving malls enjoyed more favorable local market conditions. On average, surviving malls had faster population and household income growth rates in their surrounding areas. This advantage persisted in every decade since 1970. Population growth in surviving mall areas was 26 percent faster in the 1970s. Afterward, the gap persisted but shrank to an 8 percent difference in growth each decade. The income gap was smaller, standing at 14 percent in the 1970s. It decreased to a little less than 6 percent difference per decade. Notably, both population and income growth continued even in dead mall locations. A region does not necessarily need to experience absolute decline to lose retail vitality.
Department Store Closures
Historically, department store anchors occupied the largest footprints within malls. They attracted customers and were symbols of retail strength. Malls varied in the mix of department stores. Some chains were nearly ubiquitous, such as Sears, and luxury chains were important for malls in high-income areas. Declining department store spending spelled the end for department stores at all price points, and chain consolidations and closures impacted most malls. Survivor malls were better able to fill vacant anchor sites than many dead malls.
The sequence of department store closures sheds light on many factors driving mall obsolescence, including anchor attrition, market saturation, and national and local market trends (Figure 4). Notable chains at the dead malls include Sears, Dillard’s, JCPenney, Lord & Taylor, and Macy’s.
Source: Texas Real Estate Research Center
A review of anchor appearances across 10 major dead malls reveals the extent of this concentration and the vulnerability that followed. The most common anchors among the closed malls were JCPenney (9 malls), Joske’s/Dillard’s (8), Sangar-Harris/Macy’s/Foley’s (7), and Sears (6). These chains were the foundation of many large Texas malls. Regional legacies, such as Titche’s, Sangar-Harris, Joske’s, and Foley’s, were absorbed by national brands, signaling consolidation rather than net growth. By the 2010s, department stores faced shrinking market share, rising e-commerce competition, and declining mall visitation.
Relying on a small number of anchors was a systemic risk for malls. The performance of the more widespread chains, such as Sears, JCPenney, and Macy’s, reveals both national retail crises and local market weaknesses. As national department stores weakened, multiple properties across Texas simultaneously lost key anchors. There were fewer suitable replacements available over time. The department store anchor era that once underpinned mall development thus became one of the chief vulnerabilities leading to their eventual decline.
There are two common patterns in the department store closures. First, many closures align with national waves of department store contraction, particularly during the mid-2010s and COVID-19 pandemic. Major chain closures or consolidations impacted many Texas malls, including:
- Mervyn’s-Early chain closure, preceding the broader national retrenchment period. Its 2005-06 Texas exits marked the first signs of the mid-tier department store model weakening, especially in competitive suburban markets.
- Sears-Underwent multiple large closure waves, from the early 2000s (following Kmart’s bankruptcy) through its 2018 Chapter 11 bankruptcy filing. Continued reductions into the 2020s.
- JCPenney-Gradual contraction leading up to its 2020 bankruptcy, when over 200 stores closed nationwide.
- Macy’s-Pursued store “optimization” beginning around 2018, trimming underperforming locations in mid-tier malls.
- Dillard’s-A comparatively stable chain, saw temporary and selective permanent closures during the 2020 pandemic. Some stores converted to clearance centers.
Examples of these corporate retrenchments are evident in some Texas malls. For example, Collin Creek Mall (Plano) shows a wave of anchor exits in 2014, 2017, 2018, and 2020. These track closely with the reduction in activity from Mervyn’s, Sears, and Dillard’s. Likewise, anchor store exits at Vista Ridge Mall (Lewisville) and Prestonwood Town Center came quickly just before mall closure.
Second, some Texas malls experienced more gradual but ongoing department store anchor losses. Occasional closures are typical, but it is notable that several of these dead malls failed to replace lost anchors with comparable tenants. Several early anchor losses—such as those at Six Flags Mall, Town & Country Mall, and Windsor Park Mall—occurred before the 2010s national contraction. Local market conditions play a big role in mall success. Whether in a slow decline or a quick death, differences in department store closures reflect those various local factors.
Surviving malls also faced these department store closures. Better-positioned malls sometimes retained their branch of a struggling chain. For example, among three Dallas malls, Northpark Center kept its Macy’s while that chain closed stores at Valley View Center and the Shops at Red Bird. A more important factor was that surviving malls seem to be able to more easily replace lost anchors with other department stores. Baybrook Mall (Houston) filled space vacated by Macy’s and Montgomery Ward with a newly expanded Dillard’s and JCPenney.
Over time, surviving malls also added new anchor uses. Many malls now include anchors such as AMC Theatres, Round 1, Dick’s Sporting Goods, Barnes & Noble, Dave & Buster’s, and even hotels, like at the Shops at Rivercenter in San Antonio. When Sears or Mervyn’s exited, centers such as Ingram Park Mall, North Star Mall, and Deerbrook Mall filled those gaps with furniture outlets, clearance stores, and entertainment anchors rather than leaving them empty. Some newer malls opened without traditional department store anchors. Katy Mills features more than a dozen junior anchors, including smaller retailers such as Marshalls and outlet stores like Off Fifth Saks. It also has large-format restaurants, including Rainforest Café and Cheesecake Factory.
Anchor diversification has created mixed-use retail ecosystems rather than single-format shopping centers. Stonebriar Center (Frisco) and Grapevine Mills exemplify super-diversified anchor portfolios, each hosting more than a dozen large tenants ranging from KidZania, Legoland, and Sea Life Grapevine Aquarium to entertainment and experiential anchors that appeal to families and younger consumers. These models demonstrate that the anchor function has evolved from a single large retailer to a group of attractions that keep people visiting year-round. Adaptation like this is keeping many Texas malls relevant, and they will continue to remain important retail hubs for some time.
Behind the Storefront
Daniel Oney, Ph.D. ([email protected]) is research director, Tian Su, Ph.D. ([email protected]) an assistant research economist, and Mallika Natarajan ([email protected]) a senior data analyst with the Texas Real Estate Research Center.
