Last will be the department stores. We only deal with one chain at this point, so thankfully they aren't a huge part of our business. I don't see how mall based retailers will survive long term.
What are your thoughts on stores in tourist areas? Do you see people traveling domestically in the near future? Maybe before fall if allowed?
I feel slightly better about mall based retailers as a retailer who is primarily free standing and strip centers but we do have mall stores. A huge caveat though, those in Simon, Taubman and Brookfield malls while all the independents I see in trouble. Now, the malls have incentive to see the retailers succeed as shown by Simon and Brookfield buying Forever 21 out of bankruptcy. As to anchors, malls are renting the space for far more when they leave. Malls must turn to entertainment centers.
Department stores worry me as we sell to many. I can't imagine Sears surviving. I think Macy's will go into bankruptcy but survive, while shedding stores.
Tourist areas. Again, I definitely have an interest living in South Florida. I see tourism way down as all luxury spending. I think the desire will be as strong as ever, even some pent up desire, but the ability to afford travel way down. I think hotels and resorts face some very difficult times.
I see travel opening mainly to visit family and friends. The inability to touch and hold and hug is already being felt. We get all but the touch on web cams, but I think people are finding the sense of touch far more important than they realized. For those families that have suffered loss of life, even more so.
As to stores in tourist areas, sales to tourists are a much smaller part of the business than most realize. Sales to winter residents are decent though. However, most tourists shop before travel and their spending while traveling is for lodging, restaurants and entertainment. However, lack of tourism will impact store sales dramatically because it will mean higher unemployment and less cash, less discretionary spending. South Florida's economy is dependent on tourism. So indirectly store sales will be hurt tremendously.
You mention mall stores closing, I think we'll see tremendous numbers of other stores close, single store mom and pops. In some cases, it will be financially forced and in others it will be fatigue. We've already been contacted heavily as some sellers want out at any price and others just can't afford to continue. Also, the malls seem more willing and better prepared to work with tenants than many of the owners of strip centers and free standing stores. I think many very successful business areas will come out of this looking like streets in towns where the only plant in town closed five years ago. I expect to see vacancies way up. Even just one out of ten vacant will be significant, but I expect the number in many areas to be higher. Irma basically shut people in our area down one to two weeks. I saw store owners bailing. We bought some. Turn weeks into months and it's going to be far worse. 14 new listings last 7 days in South Florida, 125 in last 30 days. Absentee owners are those most likely to not reopen.