As big department stores struggle, other mall tenants falter, too
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Macy’s usually posts its second quarter results around this time in August, but the retailer told Marketplace it’s now putting that off until early September, due to the disruptions of the pandemic. Anchors of big malls, including Macy’s, J.C. Penney and Kohl’s, were in shaky positions even before COVID-19. But it isn’t just the anchor stores that are struggling.
Traditionally the mall experience has been about more than shopping at big department stores. There are movie theaters, food courts and cosmetics stores that offer makeovers, for example.
Right now, people aren’t doing much of that, and with other mall retailers starting to close, “it really hurts the remaining tenants that are still there,” said analyst Nick Shields with Third Bridge. “Both from a foot traffic perspective, also from a competitive positioning perspective.”
Even before COVID-19, malls were trying to adapt to people buying more online.
“We’re seeing, in a few months, adoption of e-commerce behaviors that we didn’t expect to see for a few years from now,” said Barbara Kahn, professor of marketing at The Wharton School of the University of Pennsylvania.
And, as malls start to lose retail tenants, “for other retailers, they’re not going to want to expand into malls where there are quite a lot of vacancies, because there’s not much there for them either,” Shields said.
If vacancy rates increase, Shields said mall owners may have to lower rents.
COVID-19 Economy FAQs
What are the details of President Joe Biden’s coronavirus relief plan?
The $1.9 trillion plan would aim to speed up the vaccine rollout and provide financial help to individuals, states and local governments and businesses. Called the “American Rescue Plan,” the legislative proposal would meet Biden’s goal of administering 100 million vaccines by the 100th day of his administration, while advancing his objective of reopening most schools by the spring. It would also include $1,400 checks for most Americans. Get the rest of the specifics here.
What kind of help can small businesses get right now?
A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.
What does the hiring situation in the U.S. look like as we enter the new year?
New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.
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