With retail rent collection dropping precipitously, a new report found that 21 percent of 135 big chains weren’t paying any rent, or were paying only a small part of it last month. National retailers paid just 58 percent of their billed rent in April, which was significantly lower than the 96 percent over the same time frame in 2019, TheRealDeal reported, citing information from Datex Property Solutions.
Mark Sigal, the chief executive of Datex, said that a share of the merchants who settled up with the landlords by the close of April had begun the month with low payments.“To me, that’s indicative of a tenant who tested a strategy [of non-payment]," he said, per the report. “I think what the data show … [is] tenants backed away from that strategy.”
However, Sigal noted that over a third of tenants are seeking rent relief within the company’s network.
Datex’s report looks at large chains that have a gross monthly rent of at least $250,000 or lease at least 10 properties. The company uses verified data culled from its customer portfolio, which includes payment information from thousands of rental properties throughout the U.S. Datex's customers include landlords like Weitzman and Vestar, among others.
In separate news, the Empire State Building Trust detailed its rent collection efforts in an April call with analysts. It noted that as of April 20, it had received 69 percent of total rent charges, broken down by 46 percent for retail tenants and 73 percent for office tenants. The company took in rent deferral requests from 170 office and retail tenants that comprise 32 percent of annual rental revenue.
Some retail renters are seeking to recast their leases to encompass pandemic escape clauses and further measures. A number of retail leases limit the occupant when it comes to asking for an abatement because of interruption or “force majeure” clauses. However, counsel for some renters is seeking to have these measures be a part of new agreements.