Henry Grabar
Slate
Cities will weather this concentrated economic downturn because they went through it 50 years ago. Their neighbors may not be so lucky.
One by one, the problems that America has long dismissed as “urban” have marched into the suburbs: crime, poverty, hunger, deindustrialization, drug addiction, civil unrest. The dissolution of community institutions. An aging stock of unwanted houses.
To which we can add: the decline of retail. It has been a decade since the media declared the death of the mall, in a year that would be the first in a half-century that no new malls were built in America. It has since become apparent that the problem is a little bigger than that: Brick-and-mortar retail in general is gasping for breath. The Limited, a women’s clothing store, shut down 250 stores and laid off 4,000 workers earlier this year. Sears Holdings will close 150 stores, including 108 Kmarts, and Macy’s will close another 100. As anchor stores close, more and more malls are entering foreclosure. Financial instruments composed of debt from mall deals are looking as risky as their counterparts in residential debt did before the housing crisis.
