The retail landscape is experiencing a fundamental shift as traditional anchor tenants lose their power to drive foot traffic, while experiential tenants emerge as the new engines of shopping centre success. This transformation represents both a challenge for property owners and an unprecedented opportunity to create thriving community destinations that blend commerce with memorable experiences.

What are traditional anchor tenants and why are they struggling?

Traditional anchor tenants are large retailers like department stores and big box retailers that historically served as primary traffic drivers for shopping centres. These tenants typically occupied substantial square footage and drew consistent visitor flows that benefited surrounding smaller retailers.

The challenges facing these traditional anchor tenants are multifaceted and accelerating. E-commerce competition has fundamentally altered shopping behaviours, with consumers increasingly purchasing products online rather than visiting physical stores. Department stores, once the cornerstone of mall traffic, are experiencing widespread closures as their product-focused model fails to compete with digital convenience.

Store closures have created a domino effect throughout shopping centres. When a major department store closes, foot traffic across the entire property typically drops significantly, affecting rental income and property values. Traditional anchors are also struggling with changing consumer expectations – today’s shoppers seek experiences and community connection rather than purely transactional relationships with retailers.

What makes experiential tenants different from traditional retail anchors?

Experiential tenants focus on creating memorable activities and social interactions rather than simply selling products. Unlike traditional anchors that rely on merchandise transactions, these tenants offer services, entertainment, and experiences that cannot be replicated through online shopping.

The fundamental difference lies in value creation. Traditional retail anchors compete primarily on product selection, pricing, and convenience – areas where e-commerce excels. Experiential tenants create value through physical presence, social interaction, and memorable moments that require in-person participation.

These tenants also generate different visiting patterns. While traditional anchors might see quick, purposeful visits, experiential tenants encourage longer dwell times and repeat visits. Families might spend several hours at an activity park, fitness centre, or entertainment venue, creating multiple opportunities for spending across the property. This extended engagement model proves more resilient against digital disruption and builds stronger customer loyalty.

How do experiential tenants actually drive foot traffic and revenue?

Experiential tenants attract visitors through unique activities that require physical presence, creating natural traffic generation that benefits the entire property. These tenants typically encourage longer visits and repeat patronage, establishing reliable footfall patterns that traditional retailers can leverage.

The mechanism works through what’s known as the multiplier effect. When families visit an activity park or entertainment venue, they often arrive early or stay late, browsing other shops and dining at nearby restaurants. Properties with active entertainment tenants have seen foot traffic increases of up to 30%, boosting sales across other retailers as well.

Revenue generation extends beyond direct rental income. Experiential tenants create destination appeal that elevates property values and enables premium pricing for surrounding retail spaces. They also generate parking revenue, increase food and beverage sales, and create marketing opportunities that benefit the entire shopping centre. The regular, predictable traffic patterns these tenants establish provide property owners with stable, long-term revenue streams that prove more resilient than traditional retail models.

What types of experiential tenants are most successful in today’s market?

The most successful experiential tenant categories include activity parks, fitness centres, entertainment venues, dining experiences, and educational facilities. Each category succeeds by offering unique value propositions that encourage regular visits and extended engagement.

Activity parks represent a particularly strong category, with concepts that combine physical movement, social interaction, and multi-generational appeal. At SuperPark, we’ve seen how comprehensive activity offerings spanning 25-45 unique experiences under one roof create sustained visitor interest across diverse age groups. These venues work because they address fundamental human needs for movement, play, and connection that screens cannot satisfy.

Fitness centres and wellness facilities succeed by building routine visits and community connections. Entertainment venues like bowling alleys, escape rooms, and gaming centres thrive through group experiences and special events. Dining experiences that offer unique atmospheres or interactive elements create social destinations rather than mere meal locations. Educational facilities, including tutoring centres and skill-based workshops, succeed by serving ongoing community needs while generating regular traffic patterns.

How should property owners transition from traditional to experiential anchor strategies?

Property owners should begin by evaluating their space requirements and target demographics to identify appropriate experiential tenant categories. This transition requires adapting lease structures, potentially accepting different revenue models, and supporting tenants through the establishment phase.

The evaluation process starts with understanding your property’s community demographics and existing tenant mix. Large vacant department stores can be transformed into activity centres, fitness facilities, or entertainment venues. From our perspective at SuperPark, we’ve found that spaces ranging from 15,000 to 40,000 square feet can be successfully adapted for comprehensive activity concepts that serve as powerful traffic drivers.

Successful transitions often require flexible lease structures that account for experiential tenants’ different operating models. These might include revenue-sharing arrangements, longer lease terms to support substantial fit-out investments, or performance-based rental structures. Property owners should also consider infrastructure requirements such as enhanced ventilation, specialised flooring, or increased electrical capacity that experiential tenants might require.

The retail transformation process works best when property owners maintain occupancy during transitions by phasing changes strategically. This might involve securing experiential anchors before traditional tenant leases expire, or creating temporary activation spaces that generate buzz during renovation periods. Success requires viewing experiential tenants not just as space fillers, but as community destinations that can fundamentally transform a property’s appeal and long-term viability.

Partner with SuperPark to turn underperforming retail spaces into vibrant community hubs that drive lasting foot traffic and revenue. Contact our team to explore partnership opportunities.