As retail stores fade, private clubs take over mall real estate

In today’s K-shaped economy, lower-income consumers headed out to shop may be hitting Dollar General or a post-bankruptcy Big Lots, but affluent Americans are increasingly headed for the shopping center private club. Membership clubs are increasingly being seen as retail revitalizers, whether that’s in a traditional mall, open-air shopping center, or as a stand-alone commercial real estate tenant.

Like their country club cousins, private clubs require monthly dues and often an initiation fee. For instance, Dallas’s Highland Park Village, which boasts shops like Hermès, Fendi and Brunello Cucinelli, is also home to Park House, a private club offering fine dining, a wine bar, and art experiences. Resident memberships can be had for a $7,000 initiation fee and annual dues of $292 monthly (a spouse can join for $4,000). The Moore House in Miami’s open air Design District has a $5,000 initiation fee and monthly dues over $400. In addition to dining and product curation, it offers overnight accommodations if needed.

Data is scarce because they are so new, but R.J. Hottovy, head of analytical research at Placer.ai, says that the popularity of these clubs as part of existing shopping destinations is increasing and tracking with other trends in retail, such as malls that have been increasingly populating themselves with gyms, co-working spaces, and retail clubs with dues replacing discounts as the draw. Both street level retail and malls are discovering that memberships boost business and drive traffic to retail centers like Highland Park Village.

“We have seen an increase in these. They appeal to high-end consumers. The idea is it’s another place, a status symbol. It is exclusivity,” Hottovy said. He added that in the post-Covid era, Placer.ai’s research also shows more diners gravitating toward country clubs and fewer to restaurants. Private clubs offer a similar “safe space” for people to gather.

The clubs, once confined to the coastal elite, are increasingly finding their way into flyover country. The Social House, a club with a $4,000 initiation fee and monthly dues, recently opened adjacent to The Banks, a busy open-air retail area in Cincinnati. A vacant building in downtown Grand Rapids, Michigan, will be transformed into The Commerce Club, a private club featuring a cafe, event space, coworking areas, and a speakeasy. Scheduled to open in November 2026, co-founder Jeff Lambert says it will help revitalize an area near downtown. “The idea is to take a building that has been vacant for over a decade and turn it into a hub of activity,” Lambert said of the 55,000-square foot space.

Lambert, a local developer, was inspired by similar private clubs overseas or in larger U.S. cities, and he says mid-sized cities across the U.S. are seeing the biggest growth in the private club market. Even as recently as five years ago,…