The last person I'd want to be today is a mall operator - strip or otherwise.
Commercial tenants of almost all stripes are getting killed. And just about every one of them is going to ask-for/demand a rent decrease. For example:
Movie-rental chain Blockbuster Inc. sent letters to its landlords around the country in January saying that company real-estate representatives would be in touch. "It is imperative that you respond to their call expeditiously and favorably," the letter reads. The topic: Blockbuster, struggling under a mountain of debt, wants rent reductions of as much as 30% and early lease terminations at thousands of its outlets.
Some landlords don't seem to be biting. Weingarten Realty Investors Inc., based in Houston, has 50 Blockbusters spread among its 323 U.S. shopping centers. "There's no way we're going to do that on any significant basis," ...
No way, huh?
We shall see.
Mall owners are screwed no matter what they do. Don't give rent reductions....and they'll accelerate the demise of lessees.
Grant them, and they'll just open the door for other tenants to plead for similar reductions.
The mall operators essentially have ZERO LEVERAGE in this game. Who'd fill an empty storefront today? Maybe a pawnshop but that's about it.
Furthermore, as stores go empty, it lowers *foot traffic* - which hurts the rest of the tenants.
Recently I talked to a *fast-casual restaurant owner* in a local mall. He told me he was now hemorrhaging money, "every month". I told him to take his financials to the mall operator and ask for a rent reduction. Amazingly, the thought never even crossed his mind.
Empty strip malls are everywhere these days - even up north.
Just how many walk-in businesses do we really need anyway?
Mall operator - an unenviable job, but with *choice* parking.