Country’s Biggest Mall Owner Warns Retail Apocalypse May Not Be Over
While 2018 saw a large number of retailers filing bankruptcy and closing up, the biggest owner of shopping malls throughout the U.S. says it fears more are on the way this year.
David Simon, CEO of Simon Property Group, in an earnings conference call Friday told analysts “there are some retailers out there that we’re nervous about. We’re concerned about a few [bankruptcies] that should shake out in the first quarter.”
While Simon said he didn’t expect as many retail bankruptcies this year as we’ve seen the past two, there are still lingering questions about some companies that struggled last year. Sears is still very much on the edge as chairman Eddie Lampert tries to save 400 stores amid resistance from creditors (including Simon) and JC Penney has shut down hundreds of stores as well.
To fill those gaps, Simon has been working with hotels, gyms, and other non-traditional mall tenants to fill the vacant spaces left by consolidating and collapsing retailers.
2018 was an especially tough year for Simon in terms of bankruptcy vacancies. Beyond Sears and Penney, Brookstone closed 101 mall stores as part of its second Chapter 11 filing, the Gap closed locations, and Macy’s consolidated as well.
Simon did not name any specific retailers in voicing his concerns about the state of retail.