Whether you choose to wear a mask or not, our country will look significantly different than it did three months ago.
In 2019, over 9,000 retail stores closed, which was an increase from 2018. Estimates for 2020, Pre-Pandemic, retailers are were expected to close 3,300 stores. But post-pandemic, the number of closures could be as high 12,000.
At the start of 2020, several retailers had already committed to closing retail locations. In January, Pier 1 planned to close 450 stores. GameStop had closed 333 stores. Papyrus, the paper goods store, planned to close 254 stores starting in January in the U.S. and Canada. Other big name retailers, Macy’s, Modells, Forever21, Sears, Bath & Body works, Bed, Bath & Beyond, Kmart, Nordstrom, Hallmark, and the list goes on.
So, what will become of shopping malls with all of these stores closing? As more and more stores close, consumers have less of a reason to visit empty caves of closed stores. The Gap suspended rent payments to all of its 2,000-plus locations, is being sued for breech of contract, by mall owner Vestar. Lawyers seem like they will be the big winners during this moment of crisis.
In February, Simon, the largest mall operator, bought Forever21. I wonder how that investment is looking in May? I’m not sure that Mega Malls can rebound given the expected number of store closures and the vast amounts of delinquent rent.
