Macy’s hasn’t committed to opening a certain number of stores in strip malls over the next year, but it is testing a new store concept, called Market by Macy’s, that’s designed for open-air malls. “You have to carry things that would have a bit more of an accelerated purchase frequency.” “The trick with the strip mall is you’ve got to have a retail business that inherently that generates traffic,” Gildenberg said. Gaul told Glossy that of the stores Sephora will open this year, many of them will be about 1,500 square feet smaller than the typical Sephora store, and will carry more hair care and skin care products in the front of the store. Ulta Beauty’s success in strip malls - during its third quarter earnings in December, the company beat profit expectations –– helps explain why Sephora is opening more stores outside of enclosed malls. Retailers that have reported having most or a significant portion of their stores in strip malls include Target, Ulta Beauty TJ Maxx and Kohl’s. Generally speaking, strip malls are typically suburban, mixed-use facilities that are located just off of a major road, with all of the parking located between the road and the retail space, according to Bryan Gildenberg, chief knowledge officer of Kantar Consulting. Sephora announced that it plans to open 100 new stores in 2020, with many of them being in strip malls. “What we have been lacking is being in those neighborhoods where goes to SoulCycle or picks up pizza on Friday evening,” Jeff Gaul, Sephora’s svp of real estate and development told Glossy. The challenge with strip malls is that retailers often have to reconfigure their stores and/or product assortments in order to convince shoppers to stop in every time they visit the strip mall. The anchor tenants are often grocery stores or gyms, which means that retailers have the benefit of being in a place where shoppers have been conditioned to visit multiple times a week. The rent at strip malls is typically cheaper because their stores are typically smaller. There are a few benefits to strip malls that are becoming increasingly important as more shopping is done online, and fewer shoppers visit malls.

Strip mall building cost