As consumers turned to shopping online and major anchor stores such as JCPenny and Macy’s closed, malls pinned their hopes on movie theaters to draw customers to the shops that remain.
Ninety of the 240 A-rated U.S. malls have theaters, while 170 of the 700 B-rated centers have them, according to Green Street, a commercial property consulting firm.
But now, with Cinemax Group closing more than 530 U.S. theaters indefinitely, and AMC – the world’s largest theater chain – telling market analysts it will run out of cash in two months, shopping malls face an even darker future.
AMC has been the seventh-largest contributor to rents for National Retail Properties, a trust that owns several malls.
Although some landlords have discounted theaters’ rents, many have paid less in recent months than malls’ struggling retailers, according to the Financial Times.
Retail Properties of America, which owns 102 sites, has said it received only 9 percent of its rent due from theaters in the second quarter.
TREND FORECAST: The pall on the malls has been long forecast by the Trends Journal. As the “Greatest Depression” deepens, only the strong will survive. Thus, we concur with Morgan Stanley that over the next five years, a third of U.S. malls will close.
