Shoppers wear protective masks at the Glendale Galleria mall in Glendale, California on Thursday, May 6, 2021.
Bing Guan | Bloomberg | Getty Images
The largest global trade association for the retail real estate industry is rebranding to update its image in the face of massive changes in the way people shop.
The International Council of Shopping Centers announced on Monday that its initials ICSC will now stand for Innovating Commerce Serving Communities. ICSC said the changes took about nine months to complete.
The 65-year-old trading group said the shift was an indication of how the ICSC, its members – including owners of U.S. malls and malls – and the entire retail real estate industry are rapidly developing, in part due to the impact of the coronavirus pandemic.
“The terminology ‘shopping center’ or ‘retail real estate’ is still clearly an important part of our membership,” said ICSC President and CEO Tom McGee in an interview. “But in a way they describe the historical nature of our membership, from a demographic point of view … the type of property that it was. In contrast to the impact the industry has on communities. “
Today, according to McGee, ICSC’s membership base is expanding to include other companies such as technology startups and real estate service providers.
“This is not just a rebrand,” he said. “To me, it reflects what is happening in the industry as a whole and within our members. And we are developing with the industry. “
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The International Council of Shopping Centers has renamed its name ICSC and stands for Innovating Commerce Serving Communities.
Source: ICSC
ICSC also hopes that a major facelift will make the professional association more attractive to a younger workforce.
“We need to modernize the brand to attract new and younger generations to the industry and to make emerging companies and other sectors more welcome within the industry [commercial real estate]“Said ICSC in a package sent to some members ahead of the announcement on Monday.
The renaming comes as much of the retail real estate industry is trying to find a new foundation out of the health crisis. One of the biggest threats to many malls and shopping malls is the rise of e-commerce.
Not all properties were damaged in the past year. Centers anchored by grocery stores and large retailers like Target, for example, have thrived as shoppers seek out these stores for the essentials. However, others – and especially closed malls full of clothing boutiques – have lost tenants and watched as shoppers tumble off a cliff. It is projected that around 25% of America’s 1,000 or so malls will close by 2025 as more consumers shift their spending online.
Visitors begin to return. An index of 100 indoor shopping malls tracked by retail analyst Placer.ai found that shoppers’ traffic fell by just 8.1% in the last month from June 2019 before the pandemic.
Landlords face different hurdles in the basics of their business. In parts of the country, rents for retail properties have plummeted and the supply of space has skyrocketed, with supply by far outweighing demand. Retail rents across Manhattan have fallen for the last 15 consecutive quarters and hit historic lows.
The vacancy rate of all retail properties in the US rose to 10.6% in the first quarter of 2021, according to a study by real estate company Newmark and Moody’s Analytics REIS. That was a high that hasn’t been seen since 2013. More than 3.6 million square feet of retail space was brought back to market in 2020 and 800,000 square feet in the first quarter of this year, Newmark and REIS said.
US shopping mall vacancies hit 11.4% in the first quarter, the highest percentage in a decade, according to REIS.
While the retail real estate industry struggles, ISCS has watched its membership base shrink, according to a report in The Real Deal. Dozens of employees were laid off last year as personal events were canceled and revenue dried up, the real estate news website said.
ICSC has around 50,000 members in North America, according to a spokesman.
The annual conference of the trade organization in Las Vegas, RECon, did not take place in 2020 due to the pandemic. The event typically attracts tens of thousands of attendees from around the world. ICSC is now expected to gather its members in Sin City in December, with a full list of in-person events on the agenda for 2022.
“We expect it to be a blast,” said McGee. “People want to come together, and that’s what ICSC is historically known for.”