FLORENCE, S.C. – Magnolia Mall is part of Pennsylvania Real Estate Investment Trust (PREIT), one of two mall operators that filed for bankruptcy protection Monday.
Impacted by the coronavirus pandemic, some mall tenants have closed permanently or have not been able to pay rent. Two tenants at Magnolia Mall that have closed permanently during the pandemic are JCPenney and Victoria’s Secret.
For the most part, the mall has reopened.
Both companies, CBL and PREIT have indicated their malls will remain open as they go through the bankruptcy process, according to an Associated Press article.
The bankruptcies come just weeks before the holiday shopping season, traditionally the busiest shopping season of the year for most mall merchants. With coronavirus cases rising in many cities and states, malls may need to limit crowds this holiday season further hurting sales.
Even before the coronavirus hit, some malls were struggling due to shoppers using online services.
PREIT is based in Philadelphia and has more than 20 properties. Some PREIT malls in recent years have added restaurants and gyms, but those businesses have also been hit hard by the pandemic and have stricter rules on opening up.
In a company statement, PREIT said more stores have started paying rent, but it still expects its revenue from rent to continue to suffer as long as COVID-19 is impacting people’s lives.
PREIT’s “primary focus remains creating compelling retail and experiential destinations while prioritizing the health and safety of its employees, partners, customers and communities,” stated a company release.
“We are pleased to be moving forward with strengthening the Company’s balance sheet and positioning it for long-term success through our prepackaged plan. We are grateful for the significant support we have received from a substantial majority of our lenders, which we expect will enable us to complete our financial restructuring on an expedited basis,” said Joseph F. Coradino, CEO of PREIT in the release.
“Today’s announcement has no impact on our operations – our employees, tenants, vendors and the communities we serve –and we remain committed to continuing to deliver top-tier experiences and improving our portfolio. With the overwhelming support of our lenders, we look forward to quickly emerging from this process as a financially stronger company with the resources and support to continue creating diverse, multi-use ecosystems throughout our portfolio.”