Macerich Co., which owns stakes in 48 shopping centers, said that it doesn’t believe retail bankruptcies will weigh as heavily on the industry as they did in 2017, with similar sentiments expressed by at least three other mall operators during their recent quarterly earnings calls, according to a WSJ Pro Bankruptcy analysis. Taubman Centers Inc., Tanger Factory Outlet Centers Inc. and CBL & Associates Properties Inc. said that whatever brick-and-mortar shakeout occurs in 2018, it might be no worse than it was in 2017 and in fact might be more benign. Bankrupt retailers occupied 850,000 square feet of space at Macerich properties last year — up from 500,000 square feet the previous year. Retail bankruptcies pose risks for landlords because they can eventually lead to store closings or rent concessions. In the fourth quarter alone, bankrupt retailers occupied 160,000 square feet at Macerich properties — “a little heavier than we had anticipated,” Chief Operating Officer Robert Perlmutter said on the earnings call. Vitamin World Inc., which went bankrupt in September, has been a Macerich tenant. Read more.
Occupancy issues are at the heart of many significant retail cases, as detailed in the forthcoming ABI publication, Retail and Office Bankruptcy: Landlord/Tenant Rights, available for pre-order at the ABI Store.
