Retailers now owe $52B in back rent

Even with a vaccine on the way, debt facing brick-and-mortar stores could be insurmountable

National /
Nov.November 20, 2020 10:05 AM
An analysis of data from CoStar found that retailers nationwide had missed two to four months’ rent (iStock)

An analysis of data from CoStar found that retailers nationwide had missed two to four months’ rent (iStock)

Brick-and-mortar stores were struggling before the pandemic. But now, the retail sector owes $52 billion in back rent.

An analysis of data from CoStar found that retailers nationwide had missed two to four months’ rent, according to Bloomberg. Questions remain about how the pandemic and changing consumer preferences will affect the sector in the long run.

Even when a Covid-19 vaccine becomes widely available, the amount of debt may be insurmountable, industry pros say. An increasing number of brick-and-mortar stores, faced with expanded online shopping choices and lingering skittishness about the virus, may pack it in for good.

“You’re going to have big bubbles that are going to be hitting next year or even in the fourth quarter,” Andy Graiser, co-president of A&G Real Estate Partners, told Bloomberg. “I’m not sure if they are going to be able to make those payments in addition to their existing rent.”

Retailers’ requests for relief continue to pour in. TIAA Real Estate Account received more than a thousand requests for deferrals from tenants, most of them from retailers.

Rent collected from retailers improved to 89 percent in October, far better than the dire numbers in April, when retail landlords collected just 54 percent of rent. Malls have lagged behind, however, collecting only 79 percent of November rent.

“It’s going to take a period of years, not months, to get through this,” Michael Hirschfeld, vice chairman at JLL, told Bloomberg. [Bloomberg] — Georgia Kromrei


Related Articles

arrow_forward_ios
258 8th Avenue (Google, Target)

Target planning yet another NYC store in Chelsea

Target planning yet another NYC store in Chelsea
Union Square Hospitality Group CEO Danny Meyer and the Union Square Cafe (Photos via Getty; Wikipedia Commons)

Danny Meyer’s Union Square Hospitality halts indoor, outdoor dining

Danny Meyer’s Union Square Hospitality halts indoor, outdoor dining
From top: Park Place Mall in Tucson, AZ with Brookfield Property Partners CEO Brian Kingston; Westfield Countryside in Clearwater, FL with Unibail-Rodamco-Westfield CEO Christophe Cuvillier; and The Mall at Tuttle Crossing in Dublin, OH with Simon Property Group CEO David Simon (Google Maps, Westfield, Simon, Getty)

These are the biggest malls landlords ready to hand over to CMBS lenders

These are the biggest malls landlords ready to hand over to CMBS lenders
Macy’s CEO Jeff Gennette (Getty; iStock)

Macy’s experiments with “dark stores”

Macy’s experiments with “dark stores”
Macerich’s Queens Center Mall (Photo via Macerich)

Macerich’s Queens Center Mall emerges from special servicing

Macerich’s Queens Center Mall emerges from special servicing
More restrictions are headed to New York restaurants, causing more challenges for restaurants struggling to get by during the pandemic (Getty)

NYC requires new safety measures for outdoor dining

NYC requires new safety measures for outdoor dining
Ralph Lauren on the on the corner of East 55th Street at 711 Fifth Avenue (Google Maps)

Ralph Lauren to sublease Fifth Ave. location for a fraction of the cost

Ralph Lauren to sublease Fifth Ave. location for a fraction of the cost
David Simon of Simon Property Group and Robert Taubman of Taubman Centers  (Getty)

Simon and Taubman reach a new merger deal

Simon and Taubman reach a new merger deal
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...