Surprise! This chart shows holiday shoppers did rush to malls in final weeks of 2020

Business

Shoppers make their way through Grand Coastal Mall on Black Friday, as the coronavirus disease (COVID-19) pandemic continues, in Myrtle Beach, South Carolina, U.S., November 27, 2020.

Micah Green | Reuters

Procrastinating shoppers found they couldn’t avoid the mall during the holidays.

A data analysis released this week by Placer.ai shows how shopper visits to malls have ebbed and flowed amid the Covid pandemic. The research firm, which uses cellphone data to track consumer behavior, studied foot traffic at more than two dozen “top-tier” malls across the country over the span of the year.

Visits to the malls tracked, which Placer.ai declined to name, peaked prior to the pandemic, in February, climbing 10.7% from 2019 levels. In March — when retail stores and malls began to shut down to try to slow the spread of Covid — visits tumbled 59.5%. That was followed by a 95.9% year-over-year decline, marking a bottom, in April.

During the summer months, as Americans felt a bit more comfortable getting out of the house, visits to these malls steadily rebounded, month by month into the fall. But a resurgence in Covid cases hit traffic in November and led some to believe that U.S. malls would be especially bleak in the final weeks of the year.

A surprise came in December, however, as visits rebounded again. Some procrastinators had no choice but to head to the mall in the final days leading up to Christmas to snag last-minute gifts. The uptick shows, for some consumers, malls still serve a role as a convenient shopping option.

“The immediate nature of the post-Black Friday recovery, the strength in early 2020 and the height reached in 2020 amid exceptionally difficult circumstances all reinforce the idea that 2021 could be much kinder to indoor malls than many expect,” Placer.ai analyst Ethan Chernofsky said in the report.

Still, this report only analyzed traffic at the best-performing malls in the U.S. — likely ones owned by Simon Property Group or Brookfield Property Partners, which run some of the most valuable malls in the country. The picture was surely bleaker elsewhere.

Two mall owners, CBL & Associates and Pennsylvania REIT, filed for Chapter 11 bankruptcy protection in 2020. The latter has since emerged. But mall owners face new pressures in the new year, as tenants continue to ask for rent relief or plot additional store closures after the holidays.

“It is totally a tenant’s market,” said Tom Mullaney, head of restructuring services at commercial real estate services firm JLL. “Landlords are being told either you surrender ‘X,’ or I’m just leaving.”

Visits appear to be stronger at outdoor centers, where many Americans have felt more comfortable shopping during the pandemic.

In a presentation this week at the annual ICR Conference, Tanger Factory Outlet Centers said traffic during its fiscal fourth quarter was back to about 90% of 2019 levels. The real estate investment trust owns outdoor outlet centers in cities including Daytona Beach, Florida, and Charleston, South Carolina.

Some retailers also discussed their plans this week to hold off on investing in mall stores, due to the rapidly changing shopping patterns.

“Not lot of people out there want to invest in stores today [at] a large scale, especially in the mall, because we’re waiting to see how that dust settles,” Abercrombie & Fitch CFO Scott Lipesky said during an ICR presentation. “We’ll pull back this year. We haven’t gotten [to 2021] yet … but our real estate investments will likely be down.”

Land’s End CEO Jerome Griffith said during a separate presentation that the apparel retailer’s typical expansion plans — to open 10 to 15 stores annually — are on hold for the foreseeable future.

“We don’t see the traffic coming in,” Griffith said. “So we’ll wait and see how consumers respond to brick and mortar, when things are a little bit more open up. And then if it makes sense to revisit, we’ll do it at that time.”

—CNBC’s Crystal Mercedes contributed to this data visualization.

Articles You May Like

Democratic governors accuse Trump administration of misleading them about vaccine stockpile
Ask Larry: If I File Early, Will My WIfe’s Social Security Spousal Benefit Also Be Reduced?
Tesla delivers its first Shanghai-made Model Y crossovers in China
Aging In Place: A Great Way To Extort Payback From Your Adult Children
Dwyane Wade And Gabrielle Union Bring Los Angeles Home Back To Market At $6 Million

Leave a Reply

Your email address will not be published. Required fields are marked *