The etail titan is purchasing well-located US malls to convert them into massive fulfillment centers, per NBC News. Though Amazon didn’t confirm the report, a representative told NBC that it’s exploring new locations and weighing new approaches to growth. Insider Intelligence predicted last year that Amazon would pursue this approach, which could help the brand speed up delivery times in specific markets.
With store closures set to ramp up, the timing is ripe for Amazon to leverage these spaces for its fulfillment network. The pandemic wreaked havoc on in-store retail space, especially in nonessential categories, and malls in particular face strong headwinds. Up to 80,000 stores are set to close through 2026, according to UBS—and more than 50% of mall department stores could face similar fates, per Green Street. This gives Amazon considerable greenfield to make these acquisitions, especially as struggling mall operators look to offload mortgage debt, per NBC. The company could also use these spaces to extend its push into physical retail in essential areas through chains like Amazon Fresh, diversifying its revenue stream—or as a testing ground for new payment technologies.
Doing so will be critical for Amazon to maintain its competitive positioning as ecommerce grows and rivals improve their ecommerce business.
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