Doug Healey has seen plenty of dips and downturns in the national retail real estate market. So even with a cloudy economic outlook that's sparking concerns of a potential recession, the top leasing executive for one of the country's largest mall landlords isn't overly concerned.

With more than two decades of retail merchandising and leasing experience under his belt, Healey, the senior executive vice president of leasing for Santa Monica, California-based Macerich, said demand from both retail tenants and consumers for brick-and-mortar space has reached record levels, a trend he doesn't expect to slow anytime soon.

After stitching together new tenant lineups and repurposing large blocks of former department store space that came available in the depths of the pandemic, Macerich and other retail landlords across the country are staring down new macroeconomic challenges that threaten to send more shock waves through a sector already hit hard early in the pandemic.

Healey, however, said retailers tell him they are committed to physical space even though shoppers have been making more purchases online.

"The pandemic taught us all the importance of brick-and-mortar space," he said of accelerating leasing activity. "It used to be that retailers went into a mall to sell their products, and while that's still a big part of their plan, it's now about how many brick-and-mortar stores they open along with warehouses and 'buy online, pick-up in store' services. That's not going away anytime soon, and it isn't something that can be done online alone."

What's more, Healey said, retailers realized that online traffic "goes up exponentially" in markets where they operate physical outposts. That has translated into higher sales for the tenant and a chance to leverage higher rents for landlords like Macerich.

Plenty of statistics, data points and forecasts cross his desk, but Healey spends his weeks traveling across the country talking to retail tenants firsthand while touring Macerich's 44 properties, a nearly 50 million-square-foot portfolio that is concentrated on the West Coast, around New York City and near Washington, D.C.

It can be a long commute for Healey, who prefers to keep close to Rochester, New York, where he has lived for decades. He studied finance and accounting at St. Bonaventure University in Western New York but ultimately settled farther north after he graduated with a Master of Business Administration in economics and finance from the University of Rochester's Simon School of Business.

His position at Macerich was the product of multiple acquisitions and mergers, each one boosting him higher in the national retail world. Healey's start in the real estate industry began more than four decades ago with Corporate Property Investors, a retail real estate investment trust ultimately purchased by Simon Property Group, another of the nation's largest landlords, in the late 1990s. Healey has also been a leasing representative for Wilmorite Properties, an East Coast commercial real estate company that Macerich acquired in 2005.

Healey stayed in the Rochester area after the Macerich acquisition because his attachment to the region transcends his dislike of the cold. Weekends in the summer are set aside for golfing, and no matter where he is in the United States — sometimes Phoenix, other times Los Angeles — he starts each morning with a workout.

"Sometimes you have to get a little creative when you're on the road," Healey said of squeezing in a fitness break wherever and whenever he can. When he is on the road, he travels to malls and shopping centers to work with tenants such as Target, Lululemon, Restoration Hardware, Apple and Round1.

"I get to work directly with the retailer community, and now it's not just meeting the retailers, but all of the other different uses that are moving into retail properties," Healey said. "It has evolved into thinking strategically about how to repurpose our real estate and what makes the most sense in a space. In all the years I've been in business, this is the most exciting time."

His career path has arced through a handful of economic downturns and full-on recessions, from the dot-com bubble to the Great Recession to what some call the "mall apocalypse" of the pandemic. Healey said the current economic landscape only tells one side of the story.

"We haven't seen any slowdown to date, and as of right now, there are no signs of leasing activity or demand letting up," Healey said, adding that Macerich has had a record streak for leasing volume, tenant demand and consumer spending. "We're talking to retailers all the time and negotiating with them all the time, and since many of the retailers we deal with are public companies, they're signing five, seven to 10-year leases. It's a commitment beyond anything happening now, and retailers aren't backing away."

And the proof is in the numbers. Macerich said it signed nearly 275 leases in the second quarter, more than 25% more than the roughly 215 leases it signed during the same time last year. The mall landlord reported a 7.6% jump in tenant revenue for the second quarter of the year compared to the same time in 2021, and sales per square foot for spaces less than 10,000 square feet hit $860, an all-time record for the company.

Healey's optimism doesn't mean he isn't braced for some level of change across the broader retail industry. Since the beginning of the pandemic, he said, the mix of tenants across Macerich's portfolio has been forced to adapt to a number of bankruptcies, store closures and some company departures from the brick-and-mortar arena entirely.

Yet even after its occupancy rate fell below 90% for three quarters after the pandemic broke out in 2020 — marking the low point for Macerich during the health crisis — Healey said the resulting vacancies created a chance for both the firm and its tenants to take advantage of higher-quality space. What's more, retailers that didn't have particularly healthy finances leading into the pandemic were replaced with ones poised to grow and add additional value to Macerich's properties.

When it comes to tenants such as boutique fitness operators, healthcare providers, entertainment and electric vehicle brands, "the thing that has really emerged during the pandemic, and will clearly be a bigger part of the market post pandemic, is that we stopped talking about retailers and traditional apparel tenants and now we're really talking about uses," Healey said. "We leased our way out of the occupancy lows in the Great Recession, and the occupancy we have now is an opportunity to accommodate all of these newer uses that were never there before."

So sure, there may be some bumps along the way, but with his track record of evolving tenant mixes and repositioning properties to take advantage of emerging trends, Healey said he isn't concerned about what could be on the horizon.

"We have been through these cycles before," he said. "There may be a lot of noise right now, but most retailers see this as an opportunity to take advantage of available space. We can get past the economic hiccup that's happening in the current environment. There may be challenges, but we're already thinking ahead."