Shopping malls have seen foot traffic jump substantially in recent weeks, and now some are hopeful for a rebound in a sector that has been one of the hardest hit by the COVID-19 pandemic.
A March survey by Placer.AI of 52 U.S. malls that based on mobile phone location data, found that foot traffic jumped by 86% compared to the same month one year ago, when the pandemic first broken out. However, foot traffic was still below what many analysts would agree is “normal” as it was 24% lower than what it was in March 2019.
Long-suffering mall owners and operators say that it's a hopeful sign and that they're optimistic this year will be much better than the last.
“There’s no question things are better,” Bill Taubman, president and chief operating officer of Taubman Co., which operates, manages, and leases a portfolio of shopping centers in the U.S. and Asia, told The Wall Street Journal. “Sales are also better than anticipated four months ago.”
Shopping centers across the U.S. have seen a big jump in traffic since vaccines started becoming available. Restaurants and retailers saw a notable increase in sales on Valentine’s Day for example, and say they’re optimistic that more people will return by the summer.
That said, we may not see a widespread recovery across the sector. The recovery currently seems limited to certain types of retail and has only been seen in some markets. For example, stores that sells casual wear, accessories, jewelry and watches have seen increases in customer spending, whereas stores that sell more formal dresses and men’s suits for example, haven't done as well, the Journal reported. Malls with an oversupply of stores and limited population growth also remain at risk, analysts said.
Still, the outlook for mall operators is brighter, at least. They say that rent collection at their malls is increasing. Moreover, short-term leases are becoming more common and the type of tenants they have is expanding to include health care providers and more restaurants.
"Our collection rates are above 90%; that's really good news," Ami Ziff, director for national retail at Time Equities, a real estate firm that owns eight enclosed shopping malls and dozens of open-air shopping centers in the country, told the Journal.