Guests at the Fendi Dallas Highland Park Village boutique in Dallas, Texas.
Rick Kern | Getty Images Entertainment | Getty Images
In today’s K-shaped economy, lower-income consumers who go shopping might turn to Dollar General or post-bankruptcy Big Lots, but wealthy Americans are increasingly heading to the private mall club. Members’ clubs are increasingly seen as a revitalization of retail, whether in a traditional mall, an open-air shopping center or as a standalone commercial property tenant.
Private clubs, like their country club cousins, require monthly dues and often an initiation fee. For example, Highland Park Village in Dallas, home to stores like Hermès, Fendi and Brunello Cucinelli, is also home to Park House, a private club with fine dining, a wine bar and art experiences. Resident memberships can be purchased for a joining fee of $7,000 and an annual fee of $292 per month (a spouse can join for $4,000). The Moore House, located in Miami’s open-air design district, has an initiation fee of $5,000 and a monthly fee of over $400. In addition to gastronomy and product selection, it also offers overnight accommodation if required.
Data is sparse because they are so new, but RJ Hottovy, head of analytical research at Placer.ai, says the popularity of these clubs is growing as part of existing shopping destinations and is consistent with other trends in retail, such as malls increasingly home to gyms, co-working spaces and retail clubs where fees replace discounts when the draw takes place. Both street-level retail stores and malls are finding that memberships drive business and increase traffic to retail centers like Highland Park Village.
“We’ve seen an increase in this. They appeal to high-end consumers. The idea is that it’s a different place, a status symbol. It’s exclusivity,” Hottovy said. He added that in the post-Covid era, Placer.ai’s research also shows more guests are drawn to country clubs and fewer to restaurants. Private clubs provide a similar “safe space” for people to meet.
The clubs that were once limited to the coastal elite are increasingly finding their way into flyover areas. The Social House, a club with a $4,000 initiation fee and monthly dues, recently opened next to The Banks, a busy open-air retail space in Cincinnati. A vacant building in downtown Grand Rapids, Michigan, is being converted into the Commerce Club, a private club with a café, event spaces, co-working spaces and a speakeasy. Scheduled to open in November 2026, says co-founder Jeff Lambert, it will help revitalize an area near downtown. “The idea is to transform a building that has been vacant for over a decade into a hub of activity,” Lambert said of the 55,000-square-foot space.
Lambert, a local developer, was inspired by similar private clubs abroad or in larger U.S. cities and says mid-sized U.S. cities are seeing the most growth in the private club market. Just five years ago, he says, Grand Rapids would have struggled to support a private club, but the city’s entrepreneurial class had reached critical mass. “We deserve something like this that you can experience in Madrid, LA, New York, and we can support it. We can create an experience that feels like a metropolis but is very local,” Lambert said.
The building that the Commerce Club will occupy in Grand Rapids.
Trade Club
According to Jia Li, an associate professor of marketing at Wake Forest University, developers, whether located in a mall or elsewhere, have strong incentives to adopt membership-based businesses. “Many malls face the challenge of filling vacant anchor space or unused upper floors. A private club can take up a large area while generating steady and recurring traffic,” Li said.
For high-end shopping centers, private clubs are particularly attractive because they allow owners to utilize large spaces without diluting the brand – and in many cases even enhancing it. “A well-curated members-only club can strengthen a mall’s positioning as an exclusive lifestyle destination rather than a purely transactional retail center,” Li said. In a sense, this brings malls full circle to their original social purpose. “Although we often associate malls today primarily with shopping, the early malls in postwar American suburbs were explicitly viewed as ‘community and civic centers’ rather than just retail vending machines,” Li said.
Daniel Spiegel, senior vice president and managing director at Coldwell Banker Commercial, says that while the private club concept has a decades-long history, it is becoming increasingly popular. “Private social and dining clubs were very popular from the 1950s to the 1990s, and we may be seeing a comeback in various forms,” Spiegel said. In some cases, fitness clubs, co-working concepts and social spaces that were recently common in office properties are now taking up space in retail parks. Some of the spaces Coldwell Banker represents are in very typical malls like Scottsdale, Fashion Square in Arizona, where clubs like Industrious serve as combined work and social spaces.
“These membership-based operators offer landlords attractive features such as longer-term leases, consistent off-peak foot traffic and members with discretionary income that benefits surrounding tenants,” Spiegel said. Expansion costs can be significant, and the economy must function in markets with sufficient density and demographics. “But it reflects a broader shift in which successful retail properties are becoming destinations that offer experiences that go beyond traditional shopping,” he added.
Why both landlords and consumers go clubbing
In recent years, retail landlords have pursued many options for vacant space and increasing foot traffic, from converting it into housing to a greater focus on experiences to megachurch tenants.
Sam Vise, CEO and co-founder of Optimum Retailing — and also a member of New York City-based private club Soho House — says clubs are becoming increasingly attractive to developers looking to drive traffic to their properties, because while a typical mall anchor store may bring in a customer a few times a week, a private club can bring customers to the same property multiple times a week. “As malls and retail centers rethink their role in the wake of e-commerce, these clubs introduce an integrated, high-traffic customer who values experience, community and time spent on-site – all things that traditional retail alone struggles to provide,” Vise said.
In addition to landlords looking for tenants who will generate repeat visits, younger consumers who prioritize social contacts over pure consumption and transaction frequency are driving the trend. “It creates a reason to come back weekly, sometimes even daily, and that has a positive impact on food, wellness and retail concepts,” Vise said. He added that the club trend is already opening doors for digitally native brands and new concepts to test physical retail in high-engagement environments through pop-ups that are turning heads.
“When executed well, private social clubs act as a catalyst, raising the bar for how surrounding retail engages customers and drives repeat visits,” Vise said. The downside is that these clubs do not automatically lead to wider accessibility. “Nearby retailers need to be intentional about engagement – tailoring assortment, service and store experience to a customer who expects care and hospitality, not just convenience,” Vise added.
Clubs are subject to their own boom and bust cycles. Some of the best-known club brands, including Soho House, have had mixed results in recent expansion attempts. Since going public in 2021, Soho House has plans to open additional locations, including across the United States. Now it will be privatized at a similar price to its five-year-old IPO price.
Andrew Carnie, CEO of Soho House & Co., at Soho House Dean Street in London, UK, on Wednesday, August 30, 2023.
Jose Sarmento | Bloomberg | Getty Images
In addition to the coveted seal of quality, private clubs bring something else to shopping centers: length of stay. “The longer a person stays in a property, the more money they will spend,” said Charlie Koniver, principal at Odyssey Retail Advisors, a New York City-based real estate consultant that works with luxury and contemporary retailers to create high-end shopping destinations.
A members-only club can act as an anchor for commercial properties, but Koniver says the clubs aren’t right for every mall or retail center. A private club isn’t necessarily a good candidate for an empty Sears box, and they are often more attractive stand-alone retail stores. The clubs typically have a smaller footprint, and if they are located in malls or retail villages, they are considered upscale anchor tenants. “If they are part of the retail environment, they tend to be ones that don’t have traditional anchors,” Koniver said.
According to Greg Zakowicz, an e-commerce and retail consultant at Omnisend, the private club phenomenon is an extension of a long-standing consumer need. “Let’s not forget that high-end shoppers are often members of other private clubs, such as golf and swimming clubs and even airport lounges. Now brands are taking this model and extending it to retail, offering curated products and experiences in an exclusive, private setting,” Zakowicz said.
In the current economic environment, where higher-income households continue to spend while middle- and lower-income households reduce their discretionary spending, attracting these customers becomes even more important, Zakowicz said. However, he doesn’t believe this is critical across retail. “As retail evolves, styles and preferences change, and concepts like this will certainly evolve with them. But that’s okay. I don’t think retailers need to make them sustainable in the long term to survive,” he added.
David Loranger, an assistant professor of fashion marketing and merchandising at Sacred Heart University, says the phenomenon is likely a byproduct of the K-shaped economy, in which many Americans hold stock portfolios and can afford luxuries in professional jobs. But he points out that there may also be some political conviction behind the trend towards private clubs. There’s the MAGA-friendly Executive Branch, which opened last year on the ground floor of the Georgetown Mall outside Washington DC. The club was co-founded by Donald Trump Jr. and is open by invitation only. “It could also be a kind of Mar-a-Lago halo effect, whereby those who see themselves (or aspire to be) in the ranks of Trump, Bezos and other CEO types become interested in belonging to such a club,” Loranger said.