After several years in decline, strip malls are climbing in popularity again for commercial real estate investors. These properties offer great potential for your portfolio, but it’s important to understand the why and how of successfully investing in strip malls. In this article, we’ll investigate why they are rising in popularity and how you can take advantage of the trend.
Why are Strip Malls Becoming Popular Investments Again in 2025?
Once popular, strip malls took a hit in business due to the pandemic and the rise of online shopping. However, in the post-pandemic world, a few factors combine to make them a convenient choice again.
Suburban Shift and Higher Demand
Remote work, which has remained much more common since the pandemic, allows many people to have more flexible schedules. This means that they may be able to make quick shopping trips during the day to nearby retailers. In addition, many people have moved from urban centers to more suburban areas, where strip malls are more common. Together, these factors put strip malls in much higher demand than just a few years ago.
Move Away from Traditional Malls
Many big retailers have started to move from traditional large malls into strip mall spaces. The potential for these large anchor tenants in more strip malls makes them a potentially much more profitable investment.
What are the Advantages of Strip Malls for Investors?
Strip malls are a strong way to expand your portfolio. Because of the increased demand, this is especially true in 2025. Let’s take a closer look at some of the reasons strip malls are a smart investment for commercial real estate owners.
High Demand for Existing Strip Mall Properties
Strip malls are a great opportunity right now because many of these properties already exist. In the past, many went into disuse as demand shifted to other types of retail services. Now, however, it may be relatively easy for investors to purchase an existing strip mall (rather than having to develop and build a new property). These older strip malls can be updated to fit today’s high demand.
Market Changes
Some experts believe that the commercial real estate market is beginning to ease up after several years of difficulty. That means that now is a smart time to invest as opportunities open up.
Strong Tenant Groups
Because they house multiple businesses at once, strip malls are often more stable investments. Having a mix of tenant types offers customers multiple reasons to visit, increasing profits for tenants (and therefore for you).
Additionally, a variety of tenants diversifies your portfolio. When you have multiple types of tenants or properties, you have more opportunities for success. You also have a lower chance of a problem in one area derailing your whole business.
What are the Major Considerations when Investing in Strip Malls?
Strip malls are a great potential option for your commercial real estate portfolio, but they come with a few complexities. Taking a moment to understand these major considerations will help you grow your business in a smart and successful way.
Location
As with any property, it’s important to think about how location might impact your property. Some questions you can ask include: is it walkable or easily driveable for customers? Is the area safe and well-maintained? What types of businesses are in demand here?
Understanding the location of a potential investment can not only help you decide if it’s a good choice for your business, but also help you develop it into a strong part of your portfolio. You’ll be significantly more successful if you bring in tenants whose services are in demand than those that already exist close by. For example, adding a laundromat when there are already two on the block is probably not a profitable idea.
Parking Availability
Make sure there is enough space for tenants to park. Especially if the strip mall is in a less walkable location, your tenants will not perform well if customers can’t reach them. If the parking situation is small or awkward, it might be a good idea to look at other properties.
Building a Good Mix of Tenants
In addition to knowing what types of tenants are in demand, it’s smart to create a good mix of tenants in your strip mall. For example, most strip malls have an anchor tenant. This is usually a grocery store or large national retailer that brings lots of traffic to the area.
Mixing types and sizes of businesses offers customers options when they arrive, allowing them to run multiple errands in one trip. Plus, a diverse group of tenants can help protect you, since you won’t be tied to the success of a single industry.
Access
After customers make it to your location, is it easy to navigate? Are there clear markers for each business? Is it easy to walk between stores? What about between stores and parking?
Ensuring that the site is easy for customers to use will encourage repeat visitors. This boosts the success of your tenants and the value of your property.
Manage Strip Mall Investments with STRATAFOLIO
Whether you already own multiple properties or are looking to expand into strip malls, STRATAFOLIO can help you manage your entire portfolio. Easily track crucial information about leases and financial performance, and take advantage of automated processes to streamline your workload. STRATAFOLIO is designed specifically for commercial real estate and comes with all the tools you need to grow your business while still using QuickBooks.
To learn more about how STRATAFOLIO can help you manage investments, schedule a free demo today.
