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Brick and mortar retail was already undergoing a dramatic transformation prior to the COVID-19 pandemic. Though the headlines of a retail apocalypse have been overblown and hyperbolic, e-commerce has certainly upended in-store sales across the country. Adding fuel to the fire, retailers and restaurants have struggled to stay in business as a result of shelter-in-place measures since mid-March. The ensuing economic disruption has accelerated market trends already underway and is forcing tenants and landlords to adapt to this new reality. According to Goldman Sachs, 2020’s announced and completed store closures so far (7,400) have already reached more than half of 2019’s total closures (12,370). It will likely only deteriorate from here. According to Coresight Research, as many as 25,000 stores could close permanently in 2020 as a result of COVID-19-related economic uncertainty. Bankruptcy filings by major retailers (and others like 24 Hour Fitness and Chuck E Cheese) have been regular over the last few months, including Pier 1 Imports, J Crew, Modell’s Sporting Goods, True Religion, Nieman Marcus, J.C. Penney, GNC, Lucky Brand, Sur la Table, Brooks Brothers, and Ascena Retail Group. Halfway through 2020, there have been 40 retail bankruptcies, more than both 2019 (32) and 2018 (33), according to S&P Global Market Intelligence.
