Parking by the food court just got tougher… Malls were hit hard during the pandemic as shoppers ditched fitting rooms for sweatpants. Lockdown measures forced a record 12K+ US stores to close in 2020, as mall icons like J. Crew, Neiman Marcus, and Brooks Brothers filed for bankruptcy. Now Simon Property Group, the country’s largest mall owner, is calling the comeback:
Tale of two retails… While malls have been benefiting from the return to normal, urban retailers are still struggling. Shares of Vornado Realty, which owns property in metro areas like New York, Chicago, and San Francisco, are down 33% over the past two years. A couple reasons:
There’s a long road ahead… Brick-and-mortar retail — urban and suburban — still faces an existential threat from our shift to online shopping. Case in point: there’s 90M square feet, or 16 Mall of Americas, worth of empty US storefronts. Vornado's CEO says that even though urban commercial rents may have bottomed, they’re unlikely to ever return to the "unbelievable highs" of the Before Times. Now cities like Denver are offering businesses rent-free space and up to $20K in sweeteners to open shop downtown.