Retail is in a deep spiral.
According to Coresight Research about 4,000 store closures (as of June 5th) have been announced. Among the biggest names that are closing stores while in bankruptcy are JCPenney, Pier 1 Imports, J.Crew, Neiman Marcus, 24 Hour Fitness, and the list goes on from there…
With more of us working from home and less wedding events, who needs office clothes or formal wear? It’s no surprise that Men’s Wearhouse, JoS. A. Bank sales collapsed by 60% relative to a year ago with ecommerce sales plunging 32%. Chico and The Gap combined are closing over 500 stores this year.
And for kids…Children’s Place announced on June 11 that it would close 30% of its 920 locations in the US and Canada. Less brick and mortar exposure for them as stores sales plummeted 40% last quarter while ecommerce soared by 300%.
Ladies, heard of Signet Jewelers – they’re closing 300 stores in North America! Victoria’s Secret is on the brink of major restructuring. Retailers like Lord & Taylor are delaying filing for bankruptcy protection until they can reopen their stores for liquidation sales according to Wolf Street.
How about the mall retailers— between 20,000 and 25,000 stores are expected to be closed permanently this year.
So how do Landlords lease / finance retail space going forward?
Which retailers are carrying the Covid antibody and are likely to survive the carnage?
For now–just internalize how bad the meltdown of main street retailers could be.
Stay tuned for our next article and upcoming Mansfield Breakfast (Zoom) featuring a deeper look into our Retail world of Leasing and finance.
Philip Cohen | Principal
Office: 310-551-2903 xt 10
CA RE License #01735947
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