Anchorage malls are going through an identity crisis. Here’s why that might be good thing.

Traditional retail has been forced to evolve or die in these rapidly changing times, and that is no different here in Alaska. There was once a predictable formula of building mammoth spaces aimed at attracting several large, anchor tenants that would attract enough customers to sustain other, smaller businesses, but that approach is changing fast.

Online shopping is gaining more momentum every year, and this dynamic has begun to shift in interesting ways. Right now, despite continued growth in online retail, national retail space vacancy rates are down to their lowest levels in the past decade, and rents are inching close to pre-recession highs.

Here’s what changed: The traditional large, anchor tenant department stores we are familiar with — Sears, Macy’s or JCPenney as examples — have continued the trend of significant downsizing. This has opened up space for multiple smaller, niche-focused tenants to move in to the spaces left behind.

Two years ago, retailers closed 102 million square feet across the country, a record at the time. Last year, retailers planned to close an additional 145 million square feet. While the decision to reduce square footage or even abandon a market is made in boardrooms thousands of miles away from the actual stores, the impact is felt locally. Bankruptcy, downsizing or cost cutting has played out in Anchorage’s retail scene, as evidenced by several large, hallmark businesses pulling out of the market (Sam’s Club) or closing up shop (Sears and Sports Authority).

Despite those losses, we can find a silver lining. These local square footage reductions have mostly occurred in highly desired, high-traffic locations. They are still attractive to local or new, smaller tenants. The Midtown Mall, formerly called The Mall at Sears, is a perfect example. At first, Sears reduced its retail footprint in the mall to allow Nordstrom Rack to open. Now, Sears has downsized even further in the Alaska market, transforming from a mammoth store with hundreds of thousands of square feet to its newly debuted 8,000- to 10,000-square foot specialty store located on Dimond Boulevard, called Sears Home & Life. The smaller location is narrowly focused on home goods, a huge departure from its former business plan of being all things to all people — from power tools to pantyhose. Sears’ management realized the trend was moving toward small and niche, and adjusted its retail footprint accordingly. Time will tell if this new approach is successful, but it will be interesting to watch.

The vacated location Sears left behind allowed new tenants to enter the market, and existing tenants to backfill and absorb the space. Carrs is building a modern new grocery store in the former Sears space, Guitar Center entered the market, and Planet Fitness relocated their Midtown location. Of course, REI relocated from its longtime Spenard location to the other side of the Midtown Mall after months of speculation about what would fill that gaping retail space.

One thing is certain: Change will continue in our local retail market. In subprime markets like Alaska, the shift will allow for an innovative, higher-need retail focus that is more responsive to evolving consumer preferences. While we may mourn the loss of former retail giants either out of nostalgia or feelings of inconvenience, in time the market will adjust to what we consumers need and want.

[After big-name departures, the former Sears mall gets an overhaul]