- Macerich acquired Annapolis Mall for $272M as part of its broader strategy to concentrate on high-performing Class A malls in affluent markets.
- The REIT is replacing vacant department store space with experiential tenants like Dick’s House of Sport, Dave & Buster’s, and Uniqlo to drive traffic and leasing demand.
- The strategy reflects growing investor confidence in dominant regional malls even as open-air retail centers continue attracting consumers and capital.
Macerich is making a high-conviction bet that top-tier enclosed malls still have room to grow — especially if they can attract Gen Z shoppers looking for experiences, brands, and social interaction beyond e-commerce, reports CoStar.
The Santa Monica-based retail REIT announced May 7 that it acquired the 1.5M-square-foot Annapolis Mall in Maryland for $272M, including a vacant Sears parcel with future redevelopment potential. The deal follows Macerich’s $290M acquisition of Crabtree Mall in Raleigh last year and marks another step in the company’s “Path Forward” strategy to reposition its portfolio by 2028.
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A Class A Mall Consolidation Play
Macerich is concentrating capital in dominant regional malls while selling slower-growth assets. The company sold California’s 2M-square-foot Lakewood Center for $332.1M in August 2025 and has already disposed of roughly $1.3B in properties, according to the company’s Q1 2026 earnings call.
CEO Jack Hsieh said the company now sees stronger long-term prospects for Class A malls as weaker centers continue to lose relevance. Per Macerich, only about 895 enclosed malls remain in the US today, including roughly 236 Class A regional malls.
That shrinking supply is shaping the REIT’s investment thesis: dominant malls with strong demographics can capture a larger share of both retailer demand and consumer traffic.
The Annapolis Mall Repositioning Plan
Macerich sees Annapolis Mall as a strategic extension of its Washington, DC-area footprint, complementing nearby Tysons Corner Center in Northern Virginia.
The REIT paid $260M for the operating mall plus $12M for a 13.1-acre former Sears site. The property’s prior ownership group — Kildare Partners, Centennial Real Estate, and Atlas Hill Real Estate — acquired the center from Unibail-Rodamco-Westfield in 2024 for $160M before upgrading leasing activity and tenant mix.
New and incoming tenants at Annapolis include Dick’s House of Sport, Uniqlo, Tesla, Offline by Aerie, Abercrombie & Fitch, and Dave & Buster’s. Dick’s House of Sport will open a 116K-square-foot location in a former Nordstrom box this summer.
Macerich executives said the Sears parcel also offers future mixed-use optionality, including retail, residential, or alternative uses.
Experiential Retail Takes Center Stage
A major piece of Macerich’s mall strategy centers on replacing empty department store anchors with experiential retail concepts designed to increase dwell time and traffic.
The REIT has commitments for 30 vacant anchor spaces totaling 2.9M square feet that are expected to generate more than $750M in sales, according to Hsieh.
Dick’s House of Sport has become a centerpiece of that effort. The retailer’s large-format stores include interactive features that encourage customers to test products onsite — a format Macerich says is helping revive underperforming mall wings. The strategy comes as Dick’s continues expanding its global retail footprint following its planned Foot Locker acquisition, reinforcing investor confidence in experiential sporting goods formats.
At Chandler Fashion Center in Arizona, Macerich said traffic increased more than 20% after Scheels opened in a former Nordstrom space in late 2023. The mall’s trade area also expanded more than 40%, according to company executives.
The company reported similar momentum at Freehold Raceway Mall in New Jersey after Dick’s House of Sport opened in a former Lord & Taylor space.
Why Gen Z Matters for Malls
Macerich executives repeatedly pointed to Gen Z as a key driver behind the company’s repositioning strategy. The REIT has even formed an internal committee focused specifically on understanding younger shoppers and adapting its centers to their preferences.
According to Hsieh, Gen Z consumers are increasingly returning to physical retail for discovery, entertainment, and social experiences — trends that support experiential tenants and high-quality mall environments.
That aligns with broader industry shifts. Retail landlords across the US have been leaning into entertainment, wellness, food-and-beverage, and digitally native brands to differentiate malls from traditional shopping centers and online retail.
Still, the strategy carries risk. Open-air lifestyle centers and grocery-anchored retail remain favored by many investors, and the success of Macerich’s redevelopment efforts depends heavily on sustained leasing demand and consumer spending.
What’s Next
Macerich plans to continue pruning lower-performing assets while reinvesting in flagship properties through 2028. CFO Dan Swanstrom said the company expects to sell or return another $300M to $400M of noncore assets by the end of 2026.
The REIT is also ramping up leasing efforts ahead of the ICSC Las Vegas convention later this month, where executives scheduled more than 300 meetings with retailers spanning entertainment, wellness, food, and emerging brands.
For Macerich, the next phase of mall evolution depends less on traditional department stores and more on whether experiential retail can keep younger consumers coming back in person.
