As e-commerce siphons an ever-larger portion of retail sales, what keeps businesses and consumers congregating at shopping malls?
For Simon Property Group, the largest real estate company in the world with approximately 326 retail properties in North America and Asia, at least part of the answer is tied its innovative sustainability agenda.
By testing groundbreaking new energy-efficiency and waste-management processes, for example, the mall operator hopes to encourage successful retailers to take up residence because their operating costs might be lower in a Simon Property than elsewhere.
Energy management systems have been installed across a large portion of its facilities, which cover a massive 245 million square feet. Daylight harvesting technology helps handle tasks such as turning lights on and off when appropriate, while telematics applications are being deployed to help malls automate their cooling and heating settings according to ever-changing variables, such as outside air humidity. The team also is evaluating its demand-response options, in order to earn price breaks when utilities face peak load situations.
Managers can access all of the data that Simon Property collects so they can compare consumption to other sites.
Aside from what it can do for tenants, Simon Property seeks to attract the sort of shopper who cares about his or her individual environmental footprint. One demonstration is its substantial investment in electric-vehicle (EV) charging infrastructure, meant to help assuage lingering range anxiety associated with EVs.
“Malls are somewhere between work and home, so it’s a natural place to put them,” he said. “If people come to the mall, they will spend time here.”
Caraghiaur is the first to acknowledge that some programs Simon Property is trying are challenging and unproven, which is one reason the company lets individual property managers take the lead when tackling new initiatives. But two ongoing pilot programs make it clear the company is willing to take risks.
In North Carolina, for example, the Concord Mills outlet mall has created a dedicated “Plastic Room” where a hydraulic baler is used to compress clear packaging materials such as shrink wrap, garment bags and other shipping materials generated by the local retailers and notoriously difficult to sort out. Local partners pick up the 160-pound bales at regular intervals for recycling.
Over the past six months, 140 retailers at the Concord Mills site have helped the mall staff collect about 20,000 pounds of materials, diverting it from landfills, according to Caraghiaur.
One big challenge was figuring out where to install the baler and store the bales.
“Most malls are designed to house tenants and make the shoppers’ lives comfortable, but they are not necessarily configured to make it easy to do recycling,” he said.
The plan is to collect a year’s worth of data to document costs versus benefits. That information will be used to identify other locations where similar projects might be feasible.
“Our goal is to learn what issues we will face,” Caraghiaur said. “In the end, we will take the lessons learned and apply them elsewhere.”
It hasn’t stopped there: Its location in Carmel, Ind., agreed in early 2013 to test a first-of-its-kind system developed by several technology companies, including Toshiba, Duke Energy, ITOCHU Corp., Tom Wood Automotive Group and Indiana’s clean tech program, called Energy Systems Network.
The fast-charging system relies on 10 kilowatts (10 kW) of solar generating capacity and it comes with an integrated, 75-kW battery from Toshiba to store that power, so the chargers still work when it’s cloudy or after dark.
Simon Property doesn’t charge for usage. Instead, Caraghiaur said, it views the chargers as an amenity for shoppers who happen to be parked at the mall.