The biggest retailer in the US just purchased a mall, and it might have something to do with the tight market for retail space, one expert told Retail Brew.
The Pittsburgh Post-Gazette reported that Walmart has purchased the Monroeville Mall—famously featured in the 1978 horror film Dawn of the Dead—outside of Pittsburgh for $34 million. Former owner CBL Properties announced the sale in January, and in early February, Texas-based commercial real estate firm Cypress Equities said it would lead the redevelopment of the 1.2 million-square-foot property, though it didn’t name the buyer.
Walmart confirmed its involvement in the redevelopment, but would not provide details about specific plans.
“Walmart is very interested in being part of any future redevelopment of this site,” Mark Rickel, director of corporate communications for Walmart, told Retail Brew. “Walmart is working with Cypress on mall operations and potential redevelopment of the site.”
Going big: Brandon Svec, national director of US retail analytics at CoStar, called the move “absolutely brilliant” given the lack of large tracts of developable land in the vicinity and a tight market for commercial real estate overall.
“I don’t envision them wanting to compete with Simon,” he said. “What they want to do is secure their place in a really hard, land-constrained infill market.”
This kind of purchase could become more common, Svec explained, as retailers get “more aggressive in trying to secure those sites they really want to be in.” He added that Home Depot did something similar in 2022 with the purchase of large portions of the Charlottesville Fashion Square in Charlottesville, Virginia.
“It’s not for everyone. It requires very deep pockets. Most retailers can’t go out and splash [$34] million on a mall,” he said. “But for those big box retailers who do have difficulty expanding their markets because it does require such a substantial land grab, it makes a lot of sense.”
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