NEW YORK (Reuters) - A combination of a weak U.S. economy, tight financing, a crippled U.S. consumer and changes in shopping habits could close many U.S. malls, a retail liquidator said at the Reuters Restructuring Summit on Wednesday.
“A lot of this will be going away because America was over retailed and over malled,” said Nina Kampler, executive vice president of Hilco Real Estate LLC.
The U.S. economic downturn has forced retailers to scale back expansion plans, close stores or shut their doors. And more retailers likely will fold or shrink under the weight of the financial crisis that has tightened credit, Kampler said, adding hat will mean only the fittest malls will survive.
“There’s going to be massive consolidation,” she said.
The vacant space will likely not be used for retailing, said Kampler, whose company helps failed retailers such as Steve & Barry’s, Linens n’ Things, and Wilsons The Leather Experts, shed their stock, fixtures and real estate.
Store leases have gone from being an asset in demand to nearly unwanted because of the state of the U.S. economy. In better times, the landlord, lender, or agent for the retailer would re-lease the store, Kampler said. “All three are blanks right now.”
“Landlords don’t need any more vacant space back right now,” she said. “There are huge growing vacancies everywhere, and there are far fewer retailers taking space.”
She said many retailers and mall owners have also overlooked the impact of a generation that has occupied its time with the Internet rather than the mall.
(For summit blog: summitnotebook.reuters.com/)
Reporting by Ilaina Jonas; editing by Carol Bishopric