Malls are back. As vaccinations continue to increase and infection rates slowly decrease, shoppers are returning to malls, such that in March 2021, foot traffic was 86 percent higher than in March 2020. Of course, that low level of foot traffic a year ago represented a massive decline compared to previous months, but at least the trends are heading in a more positive direction. Despite this good news, not all retailers are enjoying equal benefits. Seemingly informed by the fashion trends that became prominent during the pandemic, consumers are eschewing formal wear but embracing casual gear and accessories. Furthermore, some malls, especially those that already were struggling before COVID-19, have not rebounded. But others are showing some additional positive signs, beyond foot traffic. According to retail leasing firms, rent collection rates have gone back to nearly normal. Here again though, the industry looks a little different, reflecting trends that the pandemic initiated. Retail tenants are requesting shorter, more flexible leases, as well as rent payments based on a percentage of sales. Thus malls are back, but both their consumer trends and their operational methods look different, after weathering the COVID-19 storm.
Source: Esther Fung, “Shoppers Return to Malls, with an Urge to Shop,” The Wall Street Journal, April 27, 2021