The annual shopping center convention in Las Vegas is to commercial real estate what the Masters is to golf: a major tour event rich with history and full of opportunity for playmakers, or dealmakers in this case. The buzz on the leasing mall floor — where some exhibitor booths feature more square footage than the average house — is palpable. The energetic atmosphere is unlike any other trade show I attend.
This year's International Council of Shopping Centers (ICSC) spring convention, scheduled for May 23-26, will draw more than 30,000 attendees. The industry has grown so large it's hard to imagine a time when regional malls, power centers and lifestyle centers didn't even exist. The ICSC was founded in Chicago in 1957, and the inaugural convention in 1958 attracted only a few hundred attendees. There was no leasing mall, but rather a series of educational “clinics” and networking opportunities.
“The void that ICSC filled was huge,” recalls Jim Wilson, CEO of Jim Wilson & Associates. “The No. 1 thing that ICSC did for everybody was to provide education because it was a new industry.” Classes ranged from how to compile a market study to the art of leasing to property management. One breakout session in the 1958 program was titled “Which Tenants Fail in Shopping Centers and Why.” The topic is still applicable today.
Wilson attended his first convention in 1962 while leasing and building shopping centers for developer Aaron Aronov in Montgomery, Ala. He later served as ICSC president in 1979 and 1980. “When we started off, we were just rednecks stumbling around out there in the cow pasture. Now, the product is fantastic. Each mall [outshines] the previous one.”
One of the most significant changes over the past 45 years has been the evolution of the relationship between developers and retailers. Today's developers aggressively pursue retailers, but in the early days there was more tension between the groups, says Wilson. “We banded together to try and outfox the tenants. Retailers had their own organizations and we weren't allowed in theirs.” By the late 1960s, however, developers realized they needed retailers' insight and began appointing them to positions on the ICSC board.
Matthew Bucksbaum, chairman of General Growth Properties, says the ICSC's tremendous growth has been a double-edged sword. “There was more of a spirit of camaraderie back then. If you had a problem, you went to one of your peers, and he would guide you,” says Bucksbaum, a convention-goer for more than 40 years.
The biggest issue retail owners face today is the preservation of existing properties amid a saturated mall market, according to Bucksbaum. That's a dramatic turnaround from the late 1950s and early '60s when expansion possibilities seemed endless. “There were so many opportunities, Bucksbaum recalls. “You didn't have to worry about where your next shopping center was going to be.”