An Alternate Future for the Mall

While malls in the US have been on a steady decline, as the industry deals with the decline in brick-and-mortar sales that bode the “death of retail,” malls in Latin America continue on the rise. This is partially because online shopping has yet to take hold as it has in the US. According to Euromonitor International, in 2016, online sales made up only 2.6 percent of retail sales in Mexico, compared with 10.5 percent in the US. The death of retail—at least for now—isn’t a reality in Latin America.

Why shopping centers are booming in Mexico

Reforma 222

The white walls of Reforma 222 gleam over Paseo de la Reforma and Avenida Insurgentes, two of the main thoroughfares of Mexico City. Its atria shelter some Mexican businesses like the ubiquitous, Carlos Slim-owned department store Sanborns, alongside places like Abercrombie and Zara. One entrance opens onto the Hamburgo Metrobus stop on Insurgentes, the line taken by 480,000 people each day. The other main entrance faces Paseo de la Reforma, where dozens of other commercial centers and office complexes gleam with a similar polish.

Outside the mall, not far from the Insurgentes entrance, the streets are filled with stands and street vendors. People line up for roasted corn and tacos; women sell candy and cigarettes out of baskets. These vendors number among the nearly 60 percent of Mexico City residents who are employed in the informal economy. The contrast between informal street commerce and global mall brands captures one of the central tensions of life in Mexico City: the instability of the informal economy versus the inaccessibility of the formal.

Reforma 222 is one of dozens of urban malls in the largest city in North America. It is a stop on the Turibus circuit, and a popular weekend family destination. Malls may be dying north of the border, but in Latin America the urban mall is a growing industry, and the Mexican urban mall particularly so. Privatization, foreign investment, and the growth of the informal economy have reshaped the capital in the last few decades, and in this metropolis of 22 million people, the mall tells the story of globalization’s consequences for the Mexican city.

A critical moment for the mall—in both the Global North and South—was the 2008 recession. Demand dried up in the US, NYU anthropologist Arlene Davila points out in her book El Mall, and mall developers looked abroad for investment and development. The growth of online retail had cast a shadow over the mall industry in the US. In response, shopping malls increasingly emphasized their role not only as places to shop but entertainment centers. Here they were following trends that already had taken hold in Latin America. The Mexican movie theater chain Cinépolis, for instance, which operates over 4,300 screens worldwide, is ubiquitous in malls in Mexico. (In Mexico City alone, Cinépolis has over a dozen mall locations.)

Across Latin America, the mall has become a symbol for a globally connected middle class. What it means to be middle-class is tied to the shopping mall, and the industry is steadily growing. As of 2015, there were 1,800 malls in Latin America, and the International Council of Shopping Centers (ICSC) projected that to grow to 2,387 by 2025. By contrast, up to 15 percent of shopping malls in the US are projected to close in the next decade. Mexico City is home to three of the country’s five biggest shopping centers: Centro Santa Fe in the southwest of the city, Plaza Satelite on the city’s northwestern edge, and Forum Buenavista a few kilometers from the historic center. In 2014, Mexico had 584 commercial centers, with an average of 16.9 meters of retail space per urban inhabitant—the highest number for both measures in all of Latin America. Malls are increasingly replacing traditional and informal forms of commerce. The ICSC estimated a 30 percent increase in shopping centers, to 760 nationwide.

Malls in Latin America, unlike their United States counterparts, tend to be concentrated in dense urban areas, and they play a unique role in the way residents use the city. Throughout Latin American cities, malls follow the general trend toward privatized urban space. Gated communities and highly securitized living developments increasingly predominate among the middle and upper classes. Geographer Teresa Caldeira explores this in her book City of Walls: the neoliberal Latin American city tends toward what she calls “enclave urbanism.” It is a city of fences, walls, and security cameras; public and private spaces alike bear markers of enclosure and exclusion.

Malls are an instance of this, scaled up from the private home to the “third space.” Private security guards flank the entrances and monitor the interiors; brightly lit walkways project safety and vigilance. The mall replaces conventional public spaces: it is park, plaza, and street.

Architect and urban scholar Maria Moreno, a professor at the Universidad Autonoma Metropolitana in Mexico City, sees this trend as a threat to the modernist vision of the city. Instead of ideals of accessible, democratic space for diverse social groups, the mall implicitly excludes undesirable populations—particularly through security features—and explicitly reinforces socioeconomic hierarchies: who can afford to consume and who can’t. Of course, in theory, anyone can enter the mall, and many people do enter without the intention of buying. Moreno’s book The Social/spatial Production of the Global: Mexico City Reinvented through the Santa Fe Megaproject examines the Santa Fe luxury development in southwest Mexico City. In the book, she relates the account of a young man who lives in the poor neighborhood adjacent to the commercial center and hangs out at the mall to feel a sense of “having money.” The development of shopping centers doesn’t necessarily preclude making parks or other truly public spaces. But when the city prioritizes malls over public space, it reflects a prioritization of profit and commerce over residents’ quality of life.

In the early 1990s, Manuel Camacho Solís—then Mexico City’s head of government—announced his goal to turn Mexico City into a “global city.” To that end, he approved five redevelopment-oriented urban megaprojects. The reconstruction of the corridor between the Alameda Central—a park in the center—and Paseo de la Reforma was one of them. The others included the revitalization of the city’s historic center; the creation of Santa Fe; the improvement of Avenida Masaryk, the main thoroughfare in the upscale Polanco neighborhood; and the rehabilitation of Lake Xochimilco, an ecological zone and popular tourist destination in the south of the city. The government wanted to make the city more attractive to both national and foreign private investors by making it more “modern.” They meant to give Mexico City, as journalist Raul Monge wrote in the newspaper El Proceso, “an appearance of the first world.” (The news of the projects appeared in El Proceso under the telling headline “The capital, a first-world city for inhabitants of the third world.”)

The Polanco-Chapultepec-Hipodromo tour, marketed as “the most contemporary and fashionable tour in Mexico City,” features the upscale Antara Shopping Mall, which includes fast fashion along with luxury brands. The inclusion of malls on these tours—along with, for instance, the National Museum of Anthropology and the Zócalo—project the very image Camacho Solís sought to create: first-world, modern, competitive, global. As Camacho Solís sought connections with global investment on a local level, Mexican president Carlos Salinas de Gortari was negotiating Mexico’s connection with global investment on a national level. Salinas entered into talks for NAFTA in 1991, and the treaty’s 1994 implementation coincided roughly with the development of Camacho’s five megaprojects.

NAFTA would have striking consequences for the landscape of Mexico City. Limitations on foreign investment were lowered; policies became increasingly favorable to private developers. The Mexican poor took a hit from NAFTA: for instance, as a result of the treaty, a government program that subsidized low-cost tortillas produced from Mexican-grown corn was abolished. Rural farmers lost their livelihoods, and many left their homes to seek prospects elsewhere. The Center for Economic and Policy Research estimates that 4.9 million family farmers were displaced between 1991 and 2007. Many of the displaced migrated to urban centers in Mexico; others migrated to the US. Participation in the informal economy increased, and so did economic vulnerability among the poor.

NAFTA fueled modern, high-end structures for the global class alongside underserviced, high-poverty settlements. The glitzy Santa Fe commercial development runs up against a neighborhood of self-built cinderblock houses. Meanwhile, the central city has gentrified and become nearly unlivable for middle- and lower-income workers. More than 70 percent of city workers commute from outside the city limits, where rents are cheaper. It’s not unusual for a low-paid worker to have a several-hour commute either way. Malls, and similar private megaprojects, presumably cater to a post-NAFTA consumer class. But while the middle class has grown since the early ’90s, the poverty rate has remained early identical, and the the real minimum wage has dropped by over a quarter.

For residents of high-poverty neighborhoods, where quality public spaces are sparse, if not nonexistent, private developments in relatively well-off areas have become leisure destinations. While the central zones of the city feature numerous well-tended green spaces—the sprawling Parque Chapultepec, the largest urban park in Latin America, or, for instance, Parque España and Parque México in the trendy Condesa neighborhood—poorer zones lack safe, well-maintained public spaces for leisure and entertainment.

This could mean an alternate trajectory for Mexican and Latin American malls. While malls in the US have been on a steady decline, in Latin America they are still on the rise. This is partially because online shopping has yet to take hold as it has in the US. According to Euromonitor International, in 2016, online sales made up only 2.6 percent of retail sales in Mexico, compared with 10.5 percent in the US. The death of retail—at least for now—isn’t a reality in Latin America.

Despite favorable trends, though, Mexico’s retail industry does rely heavily on trade with the US, and Donald Trump’s rhetoric about the US–Mexico relationship has provoked uncertainty. The Mexican economy is deeply dependent on that of the US, and the mall industry quite obviously so: many malls are built with US investment and host US-owned stores. The weight of the peso has fluctuated dramatically with Trump’s election: the peso hit an all-time record low at 21.395 to the dollar in November, then a new low at 21.619 in early January. (It’s since stabilized at around 18 pesos to the dollar.) It’s unclear how Trump’s presidency will affect the Mexican economy, much less the retail market, in the long term. So far his claims about trade policy have turned out to be empty threats. Should NAFTA be annulled, it is likely that mall development would become more localized, but the enthusiasm for building malls would likely remain intact.

On any given day on the Mexico City metro, ambulatory vendors pass through the cars hawking everything from headphones to bouncy balls to cookbooks to nut mix. Individuals sell juices and churros and handcrafts at stands and on sidewalks. Informal commerce makes for over half of the city’s economy. Increasingly, though, malls have replaced traditional, informal forms of commerce, including street vendors, sprawling labyrinthine markets like Mexico City’s Mercado Merced or Mercado Jamaica, and tianguis—temporary street markets that dates to pre-Hispanic Mesoamerica, typically populated by vendors of everything from produce to pirated goods. The city’s public markets, which opened in the early 1950s and provide over 200,000 jobs to vendors throughout the city, increasingly fall prey to multinational chains. In one neighborhood, the local market’s sales decreased by 70 percent after a Walmart-owned discount supermarket opened next door. Given the dependence of so many chilangos on the informal economy, this further transition to a mall economy could mean greater economic instability for much of the urban lower-class.

So whose city is Mexico City, and whose is the mall? Last year, the New York Times lauded Mexico City as the number one tourist destination of the year. The write-up characterized it as “more cosmopolitan than ever,” as it draws talent from the world over and produces skyscrapers like bamboo. In short, the city—at least its gentrified core—increasingly resembles Manuel Camacho’s global city, attractive to global travelers, investors, and developers. The mall may, in theory, be spatially accessible to all. Anyone can bring their family to spend the afternoon people-watching by a fountain—especially if they purchase an ice cream or a pair of shoes. But it’s perverse to construe the mall as a truly common good. Ultimately, the mall, like the global city, is built to provide economic benefit to the financial class. Such is the city: the peripheries deteriorate; citizens become consumers; displacement fuels more displacement, and on the weekends, everyone goes back to the mall.

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