The mall business has turned into one of real estate's sharpest divides.

The entire U.S. has roughly 900 malls, but the top 100 properties account for half the sector's total value, according to Green Street managing director Vince Tibone, who covers U.S. malls. 

The worst 350 make up just a sliver.

Simon Property Group owns most of the malls making money. 

The company - which controls more top-tier malls than anyone else. 

Shares are up 100% since 2023 and revenue keeps growing at a nearly 6% annual clip.

Its flagship Roosevelt Field property on Long Island runs at a 96.3% occupancy rate

It has tenets like Hermes, Rolex, and Armani among its tenants.

Brookfield's mall arm, owned by GGP realty, tells a similar story. 

Across its portfolio of about 100 properties, occupancy sits near 95%. 

What tenants are selling has ballooned by around 20% since before the pandemic, and at a handful of top-performing locations, sales per square foot have climbed by more than half since 2019.

What About The Other Side?

For most malls in the country, money is running out the door.

Class B and Class C properties - the ones without luxury anchors or curated tenant mixes - are watching revenue shrink by about 5% annually. 

• Around 40 malls close in the U.S. every year.

Why? More than 11% of the $53 billion in loans tied to regional malls are past due.

That's well above the 7% rate for retail-backed commercial loans overall.

Three major mall owners - CBL Properties, Washington Prime Group, and Pennsylvania REIT - filed for bankruptcy between 2020 and 2023. 

The pandemic sped up what was already happening, but the damage started years earlier. 

Anchor tenants like JC Penney pulled out, foot traffic dropped, and the debt spiral kicked in.

Why the Winners Keep Winning

The malls that are thriving figured something out - they stopped being malls.

The strategy: Sign one giant department store and let it pull shoppers through the doors. 

Today, the best operators mix retail with food, entertainment, and experiences that give people a reason to stay longer.

So far, the strategy seems to be working.

Mall visits rose nearly 10% in 2024, with the average trip lasting close to an hour, according to GrowthFactor. 

And rents at top properties have hit all-time highs, per Cushman and Wakefield.

Gen Z is a big part of the equation - nearly 6 in 10 shoppers between 18 and 34 say they visit malls regularly - double the rate of shoppers over 55, according to Ipsos.