Coronavirus has killed far too many in its wake and isn’t done yet. Unfortunately, in addition to the tragic human lives lost, the virus may be killing even more, taking many loved hot spots as well. Before it is over, it may kill malls for good.
Shopping malls were once a haven for shoppers, teens, and preteens to hang out. Sadly, their decline had started and has slowly been decaying away at thriving malls who had been trying to hang on. And, then the Coronavirus pandemic hit. These centers were more than a place to conduct business and buy things. They were a social experience providing a place where you could walk for hours, chat with friends and find everything under one roof to buy from one store to another, to the food court.
Even before this virus has threatened every living person in its path and forced businesses and homes into lockdown, malls were seeing the beginning of their decline. Shoppers were suddenly finding it much easier to purchase items from e-commerce than to get in their car and drive to a store that may or may not be stocked with the item they were looking for. Brick and mortar stores have been facing their potential doom for years, trying to hang on by a thread.
In the spring of 2019, it was forecast that about 75,000 clothing, furniture and electronic stores would close by 2026. But, now here we are in 2020, just one year later, and these stores have been forced to shut down until the virus passes or at least to slow its spread. While closing their doors to the public was an important life-saving step to keep people from dying, the financial devastation threat this has posed to the big anchor stores that keep malls alive seems to be looming.
At the beginning of May, Neiman Marcus announced they were declaring bankruptcy. Neiman Marcus caters to wealthy shoppers. If this store is going bankrupt, how do any others stand a chance? Following this announcement, J. C. Penney filed for bankruptcy as well a little more than a week later. They plan on closing more than 240 locations. All eyes turned to Macy’s following these two discouraging announcements. They responded by delaying their first-quarter earnings report until July.
If these big, well-known, previously prosperous mall anchor stores cannot stay afloat amidst the COVID-19 shutdowns, what will happen to the smaller mall stores that rely on the larger ones to keep the doors open? Additional large brand name stores who have announced permanent closures or need for financial assistance include Nordstrom, and Lord & Taylor as well, as The Gap announcing that they will need to borrow money to keep going or will be headed to liquidate by next year.
For many who grew up shopping and meeting friends at malls, there is a lot of nostalgia connected to each and every store. This feeling and social experience may soon be nothing more than happy memories for many malls across the country.