Anchor Store

Anchor Store

What is an Anchor Store?

Anchor Store
Anchor Store

An anchor store is the big department store at the mall. Depending on the size of the shopping center, there’s often more than one and at least two, with one at either end of the property.

Their large advertising budgets and wide range of desirable merchandise help anchor stores attract shoppers to the mall. Those shoppers often spend money at the anchors as well as at surrounding smaller retailers.

Anchor stores are usually large, well-known chain retailers such as Macy’s, Nordstrom, Von Maur, JCPenney, and Lord & Taylor.

Impact on Smaller Stores

Smaller mall retailers welcome the presence of anchor stores because of the traffic they attract. It’s one reason tenants are willing to pay a premium for mall space over alternative locations.

Because of the importance of anchor stores to a mall’s success, small retailers often try to secure certain clauses in their lease agreements that protect them if department stores “go dark” – meaning, they close. A vacant (“dark”) department store space is a sure sign that a mall is struggling and an indication that a smaller retailer could be in an undesirable location if the situation doesn’t turn around.

The go-dark lease clause allows the retailer to vacate the store as long as it continues to pay rent. This isn’t in the mall owner’s best interest because too many vacancies create image and other problems for the property.

The corresponding occupancy co-tenancy lease clause allows the tenant to vacate the shop and reduce or eliminate rent in situations when an anchor store moves out or mall traffic falls below a specified level.

Shadow Anchor

Related to this, a shadow anchor refers to another big retailer located near the mall. Reference to a shadow anchor can attract an anchor store, since the shadow anchor is already bringing traffic to the area. In mall locations, a shadow anchor is often a large, free-standing store such as Home Depot, Walmart, or Bed Bath & Beyond.

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