Mallville USA: Paramus and its malls at a turning point

The future of shopping in America likely will be decided in Paramus, a small North Jersey borough with more square footage of mall space per capita than anywhere else in the country, perhaps the world.

Because of the sheer number of malls — four — within and just outside its borders, Paramus has been a trendsetter since the 1950s, helping to usher in the golden age of suburban malls.

Today, the local shopping scene is confronted by unprecedented competition. The onslaught of digital retail, headlined by the likes of Amazon.com, is forcing developers to respond creatively and urgently to shifting shopping habits. In an industry where consumers are king, shopping centers — even in the powerhouse retail center of Paramus — are rushing to reinvent themselves.

“In the whole of the country I can’t think of a place that is as densely malled,” said Jan Rogers Kniffen, a retail consultant.

As dying malls around the country are being replaced by "alls" — multi-use centers that combine housing, office space, dining and entertainment with shopping — the question facing Paramus is this: Will it remain the last holdout of shopping malls? Or will it be a national model that figures out how to make brick-and-mortar retail work into the next half of the century?

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"As for Paramus' future, I think maybe it's a mistake to be tied totally and completely to being 'Mall City,'" said Mary Noone, who grew up in Paramus in a house behind the Garden State Plaza. "It seems the trend of the future might be away from brick-and-mortar stores and it would be a shame to have empty or half empty malls. In Wayne, the Wayne Hills Mall is sitting empty and has been for years. What do you do with an empty mall?"

But she's not hopeful that the problem is solvable. 

"It's human nature to ignore a pending problem until it's a big huge unsolvable problem, so I don't feel confident any elected politician or even borough employees are going to be proactive to find some other tax replacement for stores," she said.

All eyes are on North Jersey.

“Paramus is kind of a test-case for shopping,” said Michael Lisicky, a retail historian from Baltimore. 

Twilight of the malls?

Lisicky has, over the course of 10 books, chronicled the rise and demise of the former titans of U.S. retail, the grande dame department stores that were landmarks in American cities, stores like Gimbels, Bambergers, Wanamakers and Filene’s. 

The 53-year-old became fascinated with the old department stores as a young man, when he began to see them start to fade away.

Now, he sees America’s malls entering a similar twilight period of decline.

“Going to the mall is no longer part of our routine the way it used to be,” Lisicky said. “Now the Internet is part of our routine and you have a lot of real estate that unfortunately is going to be sitting around for quite some time” in many parts of the country, he said.

But just as Paramus Park was game-changing when it opened in 1974 — it was hailed as the future of suburban malls, with a state-of-the-art design that included an indoor waterfall, live trees, and what is believed to be the first modern mall food court — it could be the place where developers reinvent the suburban mall, he said.

Mall gold mine

Paramus has been a mall magnet, and a laboratory for retail trends since the 1950s, when developers and department store owners looked at the intersection of the two highways that bisect Bergen County, Routes 4 and 17, and saw a potential gold mine.

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That touched off a retail building-frenzy so intense that by the time the borough’s fourth shopping center opened in 1974, residents had extracted a promise from politicians that it would be the last mall allowed in Paramus.

The mall boom also led to the borough’s blue laws, the toughest retail restrictions in the country, that prohibit the malls and most stores from opening Sunday — not for religious reasons, but because residents wanted to preserve their right, as suburban homeowners, to have a party or backyard barbecue without worrying that their guests would be stuck in mall traffic for hours.

But even with no Sunday shopping, Paramus stores are top sales performers, because of the demographics of Bergen County, Paramus’ proximity to New York City and New Jersey’s no tax on clothes policy. That made more retailers want to open in Paramus.

The result is Paramus has 11.2 million square feet of retail space within its 10 square miles. Of that, 4.6 million square feet is in its four malls, Westfield Garden State Plaza, The Outlets at Bergen Town Center, Paramus Park, and the Fashion Center. (A fifth mall, The Shops at Riverside, is located in Hackensack.)

That amounts to more than 170 square feet of mall space per Paramus resident, seven times the national average. When all retail is included, that figure rises to 416.6 square feet of retail space per Paramus resident, nearly nine times the U.S. per capita for all retail space. It's worth about $4.2 billion, including retail and office and commercial space.

Over-stored, on steroids

America is over-stored, with more retail space than it can sustain, retail analysts and Wall Street investors believe. By comparison, Paramus is over-stored on steroids.

That has not intimidated shoppers, however. Because of their willingness to spend, new retailers keep coming. Some retailers even have more than one location within Paramus: There are two Best Buys, two Macy's, two Marshalls. Recent additions to the shopping scene include CB2 and Design Within Reach. 

Demand is so high at Westfield Garden State Plaza and Bergen Town Center that they are actively looking for new ways to add space. Paramus Park has approval to add over 80,000 square feet, but those plans have been on hold as the mall’s owner weighs a major development.

Paramus Park, the mall that has changed the least since its opening 43 years ago, is seen as the prime candidate for a radical makeover, perhaps one that will take advantage of a recent change in the Paramus master plan to allow multi-family housing and mixed uses in the commercial zone that encompasses the malls.

'Figure out what you are going to be'

The issue for Paramus is “are the malls going to be smart enough to reinvent themselves for the 21st century?” said Paco Underhill. He is an environmental psychology researcher who pioneered the use of analytics to measure how consumers react to stores and the author of “Why We Buy: The Science of Shopping,” “The Call of the Mall: The Geography of Shopping," and other books. 

As each new mall opened in Paramus, it stole customers from the older malls, and forced those older malls to reinvent themselves and find a new niche to attract shoppers.

Even so, the malls of Paramus, which have survived this long due to North Jersey’s population and income levels, are facing big changes.

Paramus is unique for the number of malls in such close proximity, said Kniffen, the retail consultant.  But, he said, If you're an outdated mall, like Paramus Park, he said, "you'd better start figuring out what you're going to be when you grow up, because you ain't going to be what you are now."

Living at the mall

What is happening in Paramus is unfolding across America.

Real estate company JLL, which manages more than 1,000 retail centers in the United States, reported in “A New Mall Rises,” that 30 percent of the under renovation shopping centers they studied are adding non-retail uses, with apartments being the most popular new use.

Adding apartments is a logical move for malls that need to reinvent themselves, said JLL Senior Research Analyst Taylor Coyne. “By adding residential you’re already increasing the shopping base that is directly around your center,” she said.

Still, the population density of Bergen County and North Jersey means retailers still are eager to open stores there, said Marta Person Villa, senior vice president for JLL Retail Services, based in East Rutherford. Retail space still is tight in North Jersey, and the mall vacancy rate is 1 percent here, she said. Paramus remains “the clear first choice” for retailers looking to enter the New Jersey market, she said.

Mall expert Paco Underhill says the greatest asset of the Paramus malls may prove to be the large parking lots surrounding them — acres that could be converted into new residential and mixed use communities surrounding and supporting the malls.

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“If Bergen County is going to reinvent itself,” Underhill says, “maybe as baby boomers retire and leave their single family homes, rather than moving to Arizona and Florida what you’d like them to do is move into a high-rise at Garden State Plaza.”

But that will mean that malls such as the Plaza or Paramus Park will need grocery stores, drugstores and gyms.

Carrie Hook of Saddle Brook was born in 1956 and grew up as the malls of Paramus were also being born, maturing, and evolving. Hook's shopping habits evolved as the malls changed. 

As a child she used to take the No. 68 bus with her mother to the open air Garden State Plaza. She also loved going to the open air Bergen Mall, because it had an area with kiddie rides and a merry-go-round. When she was in the seventh and eighth grades, Main Street in Passaic was the place to shop for special occasion clothes. As a young mother, she took her children to Paramus Park for rides on the merry-go-round. As they became teenagers, she spent more time at Garden State Plaza, where her son worked at the Van's store, which at one time had an indoor skateboarding ramp.

Now, she said, she finds the Plaza to be too big. She isn't sure what changes it could make to make it more attractive to her. "What would they do? Make it smaller," she asked. But a concept like the Promenade center on Route 208 in Fair Lawn, a mixed use project with apartments over restaurants and retail spaces, is appealing, she said. 

"I would love to come out of my apartment and have several places to eat," she said.

Shopping in your pajamas

One potential model for Paramus can be found in Manhattan, at the Time Warner Center, a vertical mall that combines residential and hotel with retail. A big attraction there is “if you have an apartment there you can shop Whole Foods in your bedroom slippers or your pajamas,” Underhill said. “I think there are lots of very time-challenged people, and also a generation of baby boomers who want to kiss their cars goodbye Monday through Friday.”

Underhill expects that residential is the future for Paramus and other malls in New Jersey and around the country, but it will require better public and private cooperation to get there. “If you’re going to make it happen, the government is going to have to be progressive and thoughtful about getting to where they want to go,” he said.

“The challenge for Bergen County isn’t what happens to the malls," Underhill said. "It is can they stay current with a population base that wants to live a little differently in the 21st century than they did in the 20th century.”