Simon strikes back at the Gap with $107M lawsuit

Mall operator accuses retailer of “taking opportunistic advantage” of pandemic to avoid payment

National /
Aug.August 06, 2020 12:15 PM
Simon Property Group’s David Simon and Gap CEO Sonia Syngal (Getty, Wikipedia, iStock)

Simon Property Group’s David Simon and Gap CEO Sonia Syngal (Getty, Wikipedia, iStock)

Call it a retail rumble, with Simon Property Group in one corner and its largest national tenant in the other.

The largest shopping mall landlord has filed another lawsuit against the Gap. This one accuses the retailer of “taking opportunistic advantage” of the pandemic to avoid paying $107 million in overdue rent, even though some of its stores have reopened, Bloomberg reported.

In June, Simon sued the Gap, saying it owed $66 million in rent. The Gap followed that up with its own suit seeking rent relief.

Since the pandemic forced retailers across the country to close, there have been a slew of lawsuits between tenants and landlords over unpaid rent. In addition to the dispute with Simon, Gap is also involved in litigation with Brookfield Properties and other landlords.

With restrictions now loosening across the country, several Gap stores have reopened, but the company said it is still struggling in many areas.

“We remain committed to working with our landlords on mutually agreeable solutions and fair rent terms,” a representative for the Gap told Bloomberg, “just as our industry and government partners have sat with us in good faith to shape the post-Covid business landscape.”

In its counterclaim, Simon said Gap “has ample financial resources to meet its contractual obligations” but its “executive leadership made a calculated and strategic decision not to do so.”

“The Gap’s re-openings were highly selective and strategic,” the suit said. “They had more to do with The Gap’s business objectives and implementation of its new business plans than they did with any legitimate Covid-19 concerns or temporary disruptions.” [Bloomberg] — Sylvia Varnham O’Regan


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