Mall landlords are starting to seek bankruptcy protection or shutting down, the latest signs that the pandemic is deepening a crisis that began before COVID-19, The Wall Street Journal reported. CBL & Associates Properties Inc. and Pennsylvania Real Estate Investment Trust said last week they were filing for chapter 11 protection after their earlier debt-restructuring efforts failed. Both companies said they have secured support from a majority of their respective bondholders entering the bankruptcy process and hope to emerge from it as soon as possible. While retailers like Neiman Marcus Group Inc., Brooks Brothers and J.C. Penney Co. have filed for bankruptcy in recent months, it’s rare for real estate investment trusts that own malls or shopping centers to do so because REITs have more conservative debt levels than many retailers. They also have multiyear leases across a wide variety of tenants. Still, analysts said the mall-owner bankruptcy filings weren’t a surprise. Mall closings are also picking up, too. Shares of mall owners and other real estate companies rallied on Monday, after a COVID-19 vaccine proved 90 percent effective in trials. Simon Property Group Inc.’s stock price rose 28 percent, as investors bet that easing public health fears would bring more people out to the malls. But analysts say even if the pandemic comes under control, the glut of department stores and other retail tenants struggling with lower sales will continue to haunt the mall industry.
