The owner/operator of 85 shopping centers in California, Colorado and Illinois said shoppers are returning to recently reopened malls, but they’re not lingering, according to a CNBC report.
“Since last week, our average traffic has been up about 25 percent, so we are seeing more customers starting to come back,” Newmark Merrill CEO Sandy Sigal told CNBC’s “Closing Bell” Monday (May 26). “The length of stay is a little bit shorter, but I think the signs are pretty positive. I think people are starting to dip their toe in the water.”
Sigal told the network that over the Memorial Day weekend a number of his mall’s restaurants and shops opened for dining and shopping, which he said was “great.”
“Today, we are about 70 percent reopened,” he said, not just for curbside pickup but into the stores.
Even with just the essential service tenants being open, he said, “we were having double-digit traffic increases to our centers [with shoppers] going to the exact same tenants week over week since about late April.”
The chief executive of the Woodland Hills, California-based company whose portfolio includes more than 1,500 tenants occupying 10 million square feet of retail space, was quick to remind the network that not all stores are open.
“We have movie theaters, we have gyms, we have lots of places where three months ago we would have been thrilled to have close personal interaction. Those are all still closed,” Sigal said. “In LA County, we still have restrictions on people going inside stores and shopping that is still curbside. … Hopefully this week, LA County is going to open up a little bit. And even when they open, they’ll have occupancy restrictions.”
When asked about whether tenants are paying rent, Sigal said rent collection has been between 60 and 70 percent.
“For us, our biggest focus is making sure our small businesspeople survive,” he said. “The heart of our communities [and] shopping centers are small businesspeople.”
Sigal said his company has worked closely with small retailers to help them to defer some rent and assist their applications for the Small Business Administration’s Paycheck Protection Program (PPP).
On larger tenants, he said, while his firm is not tone deaf to the hard times caused by COVID-19 to merchants of all sizes, big companies have more resources.
“We understand this pandemic is affecting everybody, but some tenants have a different accessibility to the capital markets than our small tenants,” he said. “So, we said to all of our big tenants, ‘Listen, we understand that you’re are going through a lot of liquidity, and this is a very scary situation. But you can access equity markets [and] public debt markets. We need you to pay rent so that we have the resources to help our smaller tenants.’”