For a supposedly dying industry, it\u2019s startling to know that between 2020 and 2025 \u2013 pandemic lockdowns and all \u2013 California built 8 million more square feet of retail space than it tore down. Nationally, a net 257 million square feet of shopping center space was added over these six years.<\/p>\n
For the nation\u2019s top retailing state \u2013 with 1.7 billion square feet of retail \u2013 that\u2019s meek change. Six states had bolder shopping efforts, led by Texas, which added 82 million net square feet, followed by Florida, up 36 million, and North Carolina, up 15 million.<\/p>\n
Even Bill Shopoff didn\u2019t know retail construction outpaced demolition. And he\u2019s spearheading a transformation of the shuttered Westminster Mall into the Bolsa Pacific, a mixed-use project in Westminster.<\/p>\n
The work includes tearing down the 1.2-million-square-foot shopping hub and replacing it with 2,250 homes, 120 hotel rooms, two parks, and 210,000 square feet of new shopping space.<\/p>\n
![\"Bill](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2026\/09\/OCR-L-WMALLDOWN-0417-JG-04.jpg\")
Bill Shopoff operates an excavator as he tears down an entrance to Westminster Mall in Westminster, CA, on Wednesday, April 15, 2026. Shopoff, President and CEO of Shopoff Realty Investments, said he recognized the responsibility developing a legacy site, \u201cYou\u2019re not just replacing buildings. You\u2019re stewarding a piece of community history while shaping what comes next.\u201d. The 83-acre site is slated to become Bolsa Pacific, a mixed-use development by Shopoff Realty that promises open space, retail and approximately 2,250 housing units including a new Target. (Photo by Jeff Gritchen, Orange County Register\/SCNG)<\/p>\n
To Shopoff, retail\u2019s net growth is a statement about a shopping center\u2019s enduring appeal.<\/p>\n
\u201cWell-thought-out retail still has a place,\u201d says the chief executive of a development company that bears his name, \u201cIt\u2019s certainly not dying. The malls doing well, thrive. The ones that don\u2019t, guys like me knock down.\u201d<\/p>\n
Tearing it down<\/p>\n
The surprise may lie in the high-profile attention paid to tearing down shopping centers rather than building them.<\/p>\n
Across California, 23 million square feet of retail space were demolished over the past six years. California led the nation in these demolitions, outpacing Florida and Texas, which each cleared out 17 million square feet.<\/p>\n
How big is that destruction? It amounts to roughly eight South Coast Plazas, gone. The wildly successful mall in Costa Mesa is California\u2019s largest retail hub, with 2.8 million square feet of retail and dining space.<\/p>\n
Retail\u2019s wrecking ball has been busy thanks to the online shopping boom that intensified during pandemic lockdowns.<\/p>\n
Numerous big-name retailers collapsed, leaving empty storefronts. Movie theaters, once a main attraction, struggled and closed \u2013 taking away another reason to visit the mall. Finances soured for many out-of-date shopping centers.\u00a0Meanwhile, dying retail sites became prime locations for residential construction and hotels \u2013 and new retail development, too.<\/p>\n
Coming soon<\/p>\n
Amid all the doomsday chatter about in-store shopping, what\u2019s clearly overlooked is the ongoing construction of new retail space.<\/p>\n
That\u2019s probably because it\u2019s not as eye-catching as the rubble of your once-favorite mall. Today\u2019s retail development is also more modest \u2013 typically smaller neighborhood centers rather than the construction of splashy regional malls or other shopping meccas of past eras.<\/p>\n
Plus, the typical tenant lineup at shopping centers has changed. Service providers \u2013 medical, athletic and beauty, to name a few \u2013 are a major addition. These merchants weren\u2019t smacked by online shopping habits like traditional retailers.\u00a0Discount retailers, from dollar stores to merchants with ever-changing supplies of cheap goods, grew in popularity.<\/p>\n
Food and fun have gained prominence, too, as retail hubs offer consumers shopping spun as a playful destination, not simply a place for chores.<\/p>\n
\u201cThere never really was a retail apocalypse,\u201d said Jesse Gundersheim, CoStar\u2019s senior director for market analytics. \u201cWhat we\u2019ve seen is a retail transformation, not a retail extinction event. E-commerce changed consumer behavior, but it didn\u2019t eliminate the need for physical stores. In fact, many consumers, particularly younger generations, are rediscovering the value of in-person shopping.\u201d<\/p>\n
California developers added 31 million square feet of retail space between 2020 and 2025. While that sounds like a lot, it\u2019s subpar. Texas raced ahead with 100 million, and Florida added 53 million.<\/p>\n
But it\u2019s a modest pop for California. New shopping space equaled only 2% of its existing supply, trailing the 3% nationwide expansion. Texas was No. 1, with its new shopping spots accounting for 6% of its total retail space.<\/p>\n
\u201cCalifornia\u2019s slower growth reflects economic realities and development constraints,\u201d the analyst said. \u201cThe entitlement process is often longer and more expensive than in many other states. In many coastal markets, development sites are limited.\u201d<\/p>\n
The growth net<\/p>\n
What\u2019s the secret sauce behind this chapter of growth for brick-and-mortar retail?<\/p>\n
\u201cRetail follows rooftops, jobs and consumer spending,\u201d Gundersheim said.<\/p>\n
Retail still has its headaches. Not every state is growing. Shopping space actually shrank in seven states from 2020 to 2025. California grew only 0.5%.<\/p>\n
Still, the nation\u2019s shopping center owners added 1.4% more space than they demolished over the past six years. Contemplate what my spreadsheet found when the states were split into three groups by their ability to grow retail.<\/p>\n
![\"Construction](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2026\/09\/RAS-L-RAMONASTATION.jpg\")
Construction crews began laying new pavement along the storefronts at Ramona Station on May 15, as renovation work continues at the former Kmart shopping center. (Stephanie Ogilvie)<\/p>\n
The 17 states strongest in retail additions \u2013 led by Texas, up 5%, and South Dakota and Idaho, up 4% \u2013 combined to add 4% to their shopping space. Demolitions were just 1%. So there\u2019s a net gain of 3%.<\/p>\n
Contrast that pattern with shopping\u2019s laggards. These 17 states, including California, constructed new stores equal to 2% of their total retail space. However, they demolished roughly the same amount. So, square footage has been flat since 2020.<\/p>\n
Here\u2019s a key difference maker. Remember, real estate\u2019s three key words: \u201cJobs. Jobs. Jobs.\u201d<\/p>\n
Retailing\u2019s high-growth states saw total job counts expand by 9% over the same six-year period. In the same period, employment in the laggard states grew by only 2%. California jobs were up 3%.<\/p>\n
Peek at population swings, too. Retail\u2019s star states added 5% more residents in six years. The laggards were up only 1%. California\u2019s population fell 0.4% in this period.<\/p>\n
Shopping space, it seems, follows the money.<\/p>\n
Value shopping<\/p>\n
Retail\u2019s revival is evident in more than just the growing roster of shopping spots.<\/p>\n
The value of major U.S. malls rose 12% in the year ended in July. That\u2019s the top result among the 12 commercial real estate niches tracked by real estate investment analysts at Green Street.<\/p>\n
Plus, mall values are 3% above commercial real estate\u2019s 2022 price peak. That\u2019s also the industry\u2019s best four-year investment results.<\/p>\n
This turnabout is reinforced by the second-best performer on Green Street\u2019s rankings: strip malls, the smaller cousins of the giant shopping hubs.<\/p>\n
These neighborhood shopping spots saw their collective values climb 9% over the past year and are now just 2% shy of their 2022 high.<\/p>\n
\u201cRetail is one of the healthiest commercial real estate sectors,\u201d Gundersheim said. \u201cCompared with office, apartment and industrial properties, retail is delivering stronger occupancy rates and rent growth. Unlike apartments and industrial, which experienced significant development booms, retail construction remained relatively restrained. At the same time, consumer spending continues to grow, supporting retail space. The result is a sector that has largely avoided overbuilding while benefiting from steady demand.\u201d<\/p>\n
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com<\/a><\/p>\n Try Jonathan Lansner\u2019s Substack collection of economic trends. CLICK HERE<\/a>!<\/p>\n August\u2019s most-popular Southern California real estate stories \u2026<\/p>\n No. 1: Where is OC\u2019s hottest homebuying neighborhood? <\/a><\/p>\n No. 2: 338-unit affordable housing complex breaks ground in Tustin <\/a><\/p>\n No. 3: Peek inside this Newport Coast estate that sold for $39M <\/a><\/p>\n No. 4: Enderle Center sold, Campo on 17th moves ahead in Tustin <\/a><\/p>\n No. 5: Rents rise in just 22% of SoCal. See which cities got hikes <\/a><\/p>\n No. 6: Home prices dip in 38% of OC. How did your ZIP do? <\/a><\/p>\n No. 7: LA-OC\u2019s worst-paying jobs: Can those wages pay the rent? <\/a><\/p>\n No. 8: LA-OC homes still \u2018unaffordable\u2019 even with a 0% mortgage <\/a><\/p>\n No. 9: Corona del Mar retail center trades hands, a first in 80 years <\/a><\/p>\n