Bellingham’s Bellis Fair Mall and the Burlington Gallery — formerly Cascade Mall — are evolving beyond retail to stay viable as shopping habits change.
Lee Cappelletti says business at North Sound Sheds — one of Bellis Fair Mall’s newest retailers — has been “surprisingly good.”
In an age of online retail and economic volatility, malls are being faced with the need to adapt or die. Many are trying to balance the waning profitability of brick and mortar retail with the hosting of community spaces and services.
As a local dealer for Tennessee-based Old Hickory Buildings and Sheds, Cappelletti set up shop two months ago in a former parking lot space where an Interstate 5 off-ramp meets Bellis Fair Parkway.
Multiple area locations were considered for North Sound, he said, but both he and the corporate office kept coming back to the mall. He wasn’t sure how it would go, but the combination of a new, nearby Chick-fil-A restaurant and the eyeballs of freeway-exiting vehicles have proven profitable so far.
“It’s a good, open location,” he said. “People still come to malls.”
The reasons people still come to malls, however, are more varied than they used to be. At Bellis Fair, nonprofit dementia support, a charter-based high school and a branch of the Bellingham Public Library system can now be found alongside corporate and local retail.
The 536,000-square-foot mall changed ownership in November 2022, after then-owner Brookfield Property Partners defaulted on a $77 million loan earlier that year. 4th Dimension Properties — a Florida-based company that owns several dozen malls across the United States — then picked up Bellis Fair at auction for $44 million.
Almost four years into its ownership, 4th Dimension has welcomed a variety of new occupants into the mall, and seen vacancy rates at lower rates than during previous ownership.
From 2023 through the first quarter of 2026, Bellis Fair’s vacancy rate hovered between about 6.4% and 8.7%, according to data compiled by Ryan Martin, a broker at Pacific Continental Realty who tracks trends in local commercial real estate.
That’s an improvement from 2021 and 2022, when Bellis Fair’s vacancy rates were 14.7% and 11.4%, respectively; each year concluded with over 100,000 square-feet of unused space.
The Canada connection
Bellis Fair Mall has a reputation as appealing to Canadian shoppers looking for bargains, but data doesn’t always back that up.
Between a global pandemic, uneven exchange rates and a dent in relations between the two countries, border crossing traffic isn’t what it used to be.
Laurie Trautman, director of the Border Policy Research Institute at Western Washington University, said her organization no longer conducts a license plate survey in the mall’s Target parking lot to check for Canadian shoppers. But other data suggests Canadians aren’t visiting like they used to.
Between 2019 and 2025, the number of U.S. trips made by Canadians at county land borders fell 52%, from 7.1 million trips to 3.4 million trips, according to Statistics Canada. And between 2024 and 2025, the Whatcom Council of Governments noted a 36% drop in Canadian-plated cars entering Whatcom County.
“I personally think we’re probably in the situation we’re going to be in for a while,” Trautman said, of less Canadian traffic. “I don’t think it’s going to drop too much more but I also don’t think it’s going to (increase) anytime soon.”
Every five years or so, Trautman’s organization works with the Whatcom Council of Governments to survey Canadians about why they’re entering the U.S. Answers collected last summer indicate fewer Canadians were coming here to shop or fill their gas tanks compared to 2018.
“The percentage of people crossing for things like family visits and recreation has increased,” Trautman said. “So even the people who are still crossing, they’re spending less money here.”
While some Canadians have decided to boycott America due to animosity over trade-related threats made by the U.S., Martin said a decrease in spending here is probably more related to the exchange rate.
In fact, Martin has noticed a longtime correlation between the Canadian exchange rate and the mall’s vacancy rate. The last time the mall had a 0% vacancy rate, he said, was in 2012, when Canadians enjoyed an exchange rate of $1.10 on every purchase. As that exchange rate fell below par, the mall’s vacancies ticked upward until recently.
Do those numbers reflect what mall businesses are seeing now? It depends who you ask.
In the mall food court on a recent afternoon, Roman Artisan Bake’s Ed Roman said business is slow. He enjoys talking with customers who purchase his baked goods, and based on his interactions, fewer of them are Canadian compared to a year ago. He is uncertain how long he’ll remain at the mall.
In the Ruckus Room arcade, employee Lexi Mortensen said Canadian traffic seems plentiful. The Bellingham business, which also has a location downtown, serves distinctly different demographics at each location, she said. The mall caters to families and has room for birthday parties, while downtown attracts adults who want alcohol with their arcade games.
“We’re good,” Mortensen said. “I don’t know how everyone else is doing, but we’re fine.”
Educational needs
The mall’s current occupants also include two nonprofits providing very specific kinds of education.
Whatcom Intergenerational High School, founded in 2021, is a public charter school that now boasts enrollment of over 100 students, and is set to see its third graduating class this year, according to Amy Anderson, the school’s director of operations.
While having a school inside a mall might seem odd, Anderson said that when people step inside the school, they often forget about what they walked past to get there.
“When you’re here in the school, you don’t feel like you’re in the mall,” Anderson said. “I often kind of liken our doors to Narnia portals — that when you come in, you immediately are transformed into this space…and the outside world falls away, like it does in most school settings.”
Not too far away, Dementia Support Northwest — a nonprofit offering support, education and activities for dementia patients and caregivers — has been operating in the mall since June 2025 in what’s called “Amy’s Place.”
Cascade Mall changes
In Burlington, the former Cascade Mall is also seeing signs of redevelopment.
Owned by Merlone Geier Partners from 2017 to 2023, the nearly 600,000 square-foot space was sold to Burlington Investment Properties II LLC for $18.5 million in April 2023, and is now called the Burlington Gallery.
Al Monjazeb, the owner of the LLC, also purchased the former outlet mall a quarter-mile south of Burlington Gallery in 2022 under another LLC, said Scott Walker, a Pacific Continental Realty broker who serves as leasing agent for both properties.
Monjazeb is a longtime state resident who previously owned car dealerships in Bellingham and elsewhere, and is now heavily involved in real estate, Walker said. One of Monjazeb’s companies, M Groups, occupies space in the former Furniture World section of the mall complex.
Several parties were interested in both Cascade and the outlet mall, Walker added, but Monjazeb was the only one seeking to preserve the existing buildings. Those other parties favored leveling both locations in favor of multi-family housing, he said.
“We felt that there was going to be sufficient multi-family housing, and felt that the needs of the community were something different (regarding those properties),” Walker said. “What we have both heard consistently about the central Skagit County area is that there was nothing to do. Everybody was just dying for activities.”
At the Burlington Gallery, new activities are coming to fruition. Last November, Playtime Pickleball Club opened its doors in the former JCPenney location. Slingshot Adventure — billed as an Angry Birds-themed indoor entertainment and all-ages play space — is slated to open in the remaining JCPenney square footage, though Walker said its opening remains delayed from last year. Both businesses are owned by the Evans family of Anacortes, he added.
In addition, part of the former Macy’s footprint is now Christ the King Hope church, a worship and event space.
As for the mall’s main interior, closed since the spring of 2020, Walker said there’s no consensus on what will happen with it. The current owner’s plan remains focused on filling all of the mall’s exterior-facing spaces first. Only one of those spots — the Interstate-5-facing former Macy’s location — remains unleased.
Several interesting possibilities, Walker said without elaborating, have fallen through for the mall interior, and the owner has held discussions with both county and municipal government about how the space may be utilized.
The former outlet mall location now known as Burlington Plaza, however, is brimming with an eclectic blend of occupants.
Walker said there are still many various-sized spaces to fill, but if all interested parties signed leases today, the area would instantly be at 80% occupancy.
A former 10,000 square-foot Nike store is now a retina surgery center, and a former Lululemon location is now a daycare center that hosts tumbling, dance and cheerleading sessions in the evening, Walker said. The Children’s Museum of Skagit County is also now at Burlington Plaza, as is a law office and other unique residents.
“We are trying to create a vibrant community, where — over the course of time — the past will be forgotten and people will enjoy going (to the mall area) and having all sorts of activities,” Walker said. “And I think that, certainly in a community the size of Mount Vernon and Burlington, that really is what is needed these days.”
The past and the future
Jeff Jewell, Whatcom Museum photo archivist, grew up with several iconic Seattle area shopping malls, but to him they were just places of corporate uniformity.
He moved to Bellingham in 1982, and was pleased to see a downtown with an existing retail core shared by local merchants and big-name department stores.
“(It was) a bit of Americana you could only hope to see in old movies,” Jewell said.
So when Bellis Fair Mall opened in 1988 and took several big retailers from downtown, he vowed never to set foot inside the place. And to this day, he hasn’t.
“I’ve kept to my firm belief that that mall was not a good thing for Bellingham, even though my daughter worked there,” he said.
The cultural evolution of Bellis Fair into something more than corporate retail, however, is something Jewell finds exciting.
“These spaces need to be redefined, for sure,” he said.
The idea of housing is especially appealing. And indeed, nearby on former mall land, low-income housing has been built on the former site of mall parking courtesy of the Opportunity Council. Jewell would like to see the mall eventually become a full-fledged urban village.
“You have to create a destination,” he said. “You have to create enough of a congregate of retail and community resources that people want to flock to, and then they feed off each other.”
Anderson, at Whatcom Intergenerational, agrees. She said the existing-synergistic experience of having access to various community resources is a valuable idea for everyone.
“I could see the evolution of malls being very powerful if we stop thinking of them as shopping centers exclusively, and other businesses started to see how co-locating with other community resources can really help everyone thrive,” she said. “It’s a really convenient place to be because there are a lot of things that are right here. It creates a unique opportunity for businesses to make partnerships you might not have otherwise, just because we’re in the same space.”
—By Matt Benoit