Analysts: Woodfield makeover may keep mall strong
Woodfield Mall's common areas will be getting a $13.9 million makeover this year, which industry analysts believe to be an example of what's required to keep even successful shopping centers relevant in a new age.
With shopping habits having been permanently reshaped by memories of the recession and the availability of new technology, traditional malls like Schaumburg's must find new reasons for people to make the trip, said Phyllis Ezop, president of Ezop and Associates, a business strategy and marketing information firm in La Grange Park.
“It does need to take steps to strengthen its competitive position,” Ezop said. “Just because there's new technology, the old ways can thrive if they're done the right way.”
Neil Stern, senior partner at Chicago-based retail consulting company McMillan Doolittle LLP, said he believes Woodfield's announcement means that times have been pretty good there. Generally, good malls have been getting better while weaker malls are dying, he said.
The factors that seem to separate the two categories are location, demographics, the strength of tenants and the availability of other amenities, such as restaurants and movie theaters, that can make the mall more of a destination, Stern said.
Woodfield ranks highly in all these ways, starting with being particularly blessed by its location and accessibility, he added.
If there's any weakness in Woodfield, it's that its interior is dated — which is probably what management is planning to address with the coming renovation, Stern said.
The details of that renovation are to be announced on Jan. 20.
With the rising popularity of the largely outdoor lifestyle center, Woodfield's 44-year-old indoor structure is especially challenged, Stern said.
One Woodfield's negatives that a cosmetic renovation is unlikely to fix is its split-level nature. This makes the mall harder to navigate for the shopper and causes some spaces to be better than others for the tenant, he said.
“They can brighten it. They can make it a little lighter,” Stern said. “Overall, it's a very high performing center.”
Dave Aron, associate professor of marketing at Dominican University in River Forest, said Woodfield's renovation could be looked at in terms of a future orientation. While people using malls are getting older, retailers are looking for younger shoppers.
At such a time, mall management has to look at who's coming to the center, why they're coming, and whom they'd like to be there, Aron said.
While a cosmetic change isn't likely to move the needle much, it could be complementary to more substantial changes — like the Pac-Man-themed Level 257 restaurant and entertainment center opening at Woodfield in a few weeks, he said.
“They need to have destinations there,” Aron said. “I really see it going in that direction. You can order things online, but you can't have a great dinner online.
“It's always exciting to see how they're keeping their visitors entertained,” he added. “They have to recognize that the audience is constantly changing.”
While Woodfield's audience may be changing, the landmark mall's importance to Schaumburg hasn't changed much over the past four decades.
The village's economy has branched out into office buildings, car dealerships, restaurants and hotels. But Woodfield is still recognized as the inspiration for these other industries' interest in the area, Schaumburg Village Manager Brian Townsend said.
“From my perspective, Woodfield is the epicenter,” he said. “It's what drives a lot of economic development, not only in Schaumburg but throughout the Northwest suburbs.”
As diverse as the local economy has become, Woodfield's tenants alone provide 22 percent of Schaumburg's sales tax — about $11 million per year from one property. Until the depth of the recession in 2009, sales tax revenues were so strong that the village didn't levy a municipal property tax.
While Townsend agrees that Woodfield's superb location got it off to a good start in 1971, he believes strong management in the years since has been essential to its continued success.
“Clearly it's a very valuable piece of piece of real estate, and people aren't going to let it get stagnant,” Townsend said. “It's a place where retailers want to be. One thing management hasn't compromised is quality.”
He added that when a business wants to try out a new concept or service, there's strong interest in testing it at Woodfield first.
Woodfield management declined to comment, preferring not to speak about the planned renovation until the invitation-only event on Jan. 20.