Evaluating Development and Community Benefits of Shopping Malls: A Case Study Using Input/Output Analysis

Thomas Allen Musil, University of St. Thomas, Minnesota

Document Type Article

16(2), 111-125.


The existing research on shopping mall development and redevelopment is very weak in addressing the importance of malls to the communities in which they are located. Existing shopping mall research has a limited focused on lease valuation issues, tenant location within malls, retail agglomeration economies, retail demand externalities and intangible asset value. Largely neglected areas of research are the community and economic contributions of shopping malls. These are critical issues given the age of shopping malls worldwide, the need for adjacent area redevelopment and requirement of large public subsidies for infrastructure construction. This paper investigates the critical role of shopping malls as town centers and catalysts for area development and redevelopment. A review of the existing research on shopping malls and retail economic contributions to communities is addressed along with how mall redevelopment can be a catalyst for the revitalization of urban core and suburban areas. Methodology on the measurement of shopping center economic and employment impacts using input-output modeling is reviewed and analyzed. Input-output modeling is an effective tool to evaluate publically supported infrastructure to accompany shopping mall and retail redevelopment. As an example of and input-output analysis of construction and mall operations economic impacts, the paper presents a case study of the proposed $2 billion Mall of America (Bloomington, Minnesota) expansion employing input-output modeling. This research demonstrates the community and economic justification for public support for mall revitalization and provides a reliable tool for quantifying the benefits of mall redevelopment and improvement.