From 2017 to 2020 store closures hit records and mall debt went delinquent, while strip center vacancy kept falling. What the data says about which small centers held value, and a closure-list ratio to run before you buy.
The retail apocalypse was real, and it mostly happened somewhere else. Between 2017 and 2020, national chains announced tens of thousands of store closures and mall loans went delinquent at record rates, while small neighborhood and strip centers came out of the period with lower vacancy than they went in. The strip centers that did get hurt had one thing in common: their rent came from the same national chains that filled the closure lists.
That matters now, because many buyers still price "retail" as one risk. An owner who understands where the damage actually landed can buy the strip centers other buyers discount and avoid the ones that only look safe.
The closures were real, and they were national
The numbers were large. Fung Global Retail and Technology, now Coresight Research, counted roughly 7,000 announced U.S. store closures in 2017. Coresight tracked 5,524 in 2018 and 9,832 in 2019, a record at the time. In 2020, with the pandemic on top, it counted 8,741 closures, and apparel retailers alone accounted for 36% of them.
The names were familiar. Payless ShoeSource liquidated in 2019 and closed all of its U.S. stores, more than 2,000 of them. Closer to home, the Bon-Ton liquidation in 2018 closed all 256 of its stores, including every Boston Store, according to CNN.
The debt markets told the same story. Per Trepp, the delinquency rate on retail loans in commercial mortgage backed securities jumped to 18.07% in June 2020, up from 10.14% a month earlier.
- Store closures 2019
- 9,832
- Store closures 2020
- 8,741
- Apparel share, 2020
- 36%
- Retail CMBS delinquency, June 2020
- 18.07%
Strip center vacancy fell through the whole decade
Now look at the properties this site's readers own. Cushman and Wakefield's national shopping center reports, which cover neighborhood, community, power and strip centers but not malls, tell a very different story.
At the end of 2015, before the closure wave, strip center vacancy was 8.7% and total shopping center vacancy was 8.0%, down from a 10.3% peak in early 2010. In the second quarter of 2020, in the middle of the worst quarter for retail in a generation, strip center vacancy was 6.4%. It had risen from 5.9% the quarter before. Cushman said most of the move-outs were inline restaurant, health care and salon tenants: businesses the pandemic shut, not ones the internet replaced.
By the end of 2024, national shopping center vacancy was 5.4%. In the first quarter of 2026, Cushman put it at 5.9%, still well under its long-run average of 7.4%.
Milwaukee followed the same arc from a weaker starting point. Cushman reported Milwaukee shopping center vacancy at 10.0% at the end of 2015, 7.8% in mid-2020 and 5.3% at the end of 2024. Cushman's Milwaukee sample shrank over that span, so treat the trend as the signal, not the exact decimals.
Why the damage skipped most small centers
Three reasons, and each one is something you can check on your own rent roll.
The closures were concentrated in goods. Apparel, shoes, department stores and electronics dominated the lists. Those categories lived in malls and power centers. A typical Southeastern Wisconsin strip center was leased to a salon, a sandwich shop, a tax preparer, a dentist and a dry cleaner. None of them were on a closure list, because none of them were competing with a warehouse and a delivery truck.
Nobody built more strip centers. Cushman's first quarter 2026 report puts space under construction at less than 0.3% of existing inventory nationally, and at zero square feet in Milwaukee. When tenants did leave, there was no new supply competing for their replacements.
Small spaces backfill. A vacated 1,500 square foot inline suite has dozens of possible users. A vacated 80,000 square foot department store has a handful, and most of them want a discount and a redevelopment budget.
The strip centers that did get hurt
Not every small center came through clean. The ones that struggled were leased the way a mall is leased: to national goods chains.
Here is a test we use. We call it the closure-list ratio: the share of a center's base rent that comes from national chains selling goods in the categories that dominated the closure counts (apparel, shoes, mattresses, electronics and phones, office supplies, department store formats). It measures how much of the center's income depends on decisions made in a headquarters, about a business model the internet is attacking.
Take two 20,000 square foot centers, both fully leased.
Center A has a mattress chain, an apparel chain, a shoe chain and a cellular carrier store, plus a dollar store, a nail salon, a pizza place and a tax preparer. Base rent is $321,500. The four national goods chains pay $198,000 of it.
Center B has a dental office, a fitness studio, a coffee drive-thru, a hair salon, physical therapy, a pet groomer, a pack and ship store, a sandwich shop and one cellular carrier store. Base rent is $377,500. Only the cellular store, at $39,000, is on the list.
- Center A closure-list ratio
- 61.6%
- Center B closure-list ratio
- 10.3%
- Rent at risk, A
- $198,000
- Rent at risk, B
- $39,000
At a 7.5% cap rate, the rent at risk at Center A is about $2.64 million of value. At Center B it is about $520,000. During 2017 to 2020, Center A was a mall in miniature, and it would have felt like one: several national tenants reviewing their fleets at once, 11,500 square feet of goods space to re-lease into a market that did not want goods space.
The irony is that Center A probably looked like the safer purchase in 2016. More national names, more signage on the pylon, a thicker offering memorandum. Center B's tenants were local and franchise operators with shorter track records. The market paid for the logos and got the closure lists.
What the decade says a buyer should pay for
The last ten years give owners and buyers a few usable conclusions.
Price the category, not the logo. A national name selling goods is not better credit than a local dentist if the national's whole category is shrinking. Look at what the tenant sells before you look at whose name is on the lease.
Run the closure-list ratio before you bid. Under roughly 20% of base rent, the center behaves like the strip centers that held. Above roughly 40%, underwrite it the way you would underwrite a small mall: longer downtime, heavier tenant improvement allowances, a higher cap rate. Those thresholds are our rule of thumb, not a published statistic, but the example above shows why the line matters.
Do not assume the good years continue. Cushman reports that closures outpaced openings by nearly 6,000 locations across 2024 and 2025, and Milwaukee shopping center vacancy rose from 5.9% to 7.1% between the first quarter of 2025 and the first quarter of 2026. Vacancy is still low by historical standards, but low vacancy is when buyers stop checking who the tenants are.
Discounts on "retail" are a buying opportunity if the rent roll is local and service based. When a lender or buyer applies a blanket retail haircut, a center like Center B gets priced with Center A's risk. That gap is where an owner who reads rent rolls makes money. If you own a Center A, the same gap is the reason to start changing the mix before you sell.
Ten minutes with your rent roll
- Mark every tenant that is a national chain selling goods: apparel, shoes, mattresses, electronics, phones, office supplies, department store formats.
- Add their base rent and divide by total base rent. That is your closure-list ratio.
- Multiply that rent by your cap rate. That is the value that depends on someone else's headquarters.
- For each of those tenants, note lease expiration and any early termination right.
- For the next two vacancies, decide whether a service, medical or food user could take the space, and what it would cost to convert.
- If you are buying, run steps 1 through 3 on the seller's rent roll before you look at the offering memorandum's cap rate.
If you want us to run it on a center you own or one you are looking at, send us the rent roll.