The Anchor Reset: Experience-Led Destinations Replace Failing Department Stores
In a bylined feature for Western Real Estate Business, Feasibly founder and CEO Brian Connolly examines how failing department store anchors are being replaced by experience-led destinations. Connolly opens with the scale of the decline, citing Statista data that puts U.S. department store locations at a projected 4,678 at the end of 2025, down more than 40 percent from 7,885 in 2015, with the retreat especially pronounced across the Western United States.
Connolly argues that the most compelling answer to vacant anchor space is a category of experiential tenants that generate repeat visitation and sustained foot traffic. These include professional sports practice facilities, multi-sport community and tournament complexes, indoor activity parks, entertainment venues and mixed-use districts, and civic and recreation-focused retail concepts. He explains that such anchors create spillover demand for adjacent shops, food and beverage, and "eatertainment" concepts, drawing regional visitors who stay longer and return more often.
The article also addresses the complexity of executing these projects. Connolly emphasizes year-round programming, sophisticated visitor demand modeling that accounts for regional draw rather than local demographics alone, accurate sizing of retail space against realistic demand, and capital structures that often rely on public-private partnerships to close feasibility gaps. He points to active Western examples, including the OCVIBE district in Anaheim anchored by the Honda Center, Smith Entertainment Group's conversion of a former Macy's into an NHL and NBA training facility in Sandy, Utah, and entertainment-led redevelopment in California's Central Valley.
Connolly closes by noting where these projects fall short, identifying poor market understanding, over-reliance on local demographics, and programming gaps as common reasons for failure. He makes the case that developers should design and operate experience-led anchors as ongoing businesses that adapt to changing demand patterns.
