“A quarter of all malls will close over the next five years”


One month ago, we first presented several striking charts and observations from Credit Suisse’s retail analyst, Christian Buss, who showed the extent of the devastation sweeping through the US retail sector.

To be sure, while the mass shuttering of retail stores – just today Michael Kors announced the company would close up to 125 full-price retail stores – has been a recurrent topic on this website as shown in the chart and most recently discussed in the context of the next “big short” trade, namely the ongoing collapse in the mall REITs and associated Commercial Mortgage-Backed Securities and CDS, one observation from Buss left us borderline speechless: “Barely a quarter into 2017, year-to-date retail store closings have already surpassed those of 2008.”

According to the Swiss bank’s calculations, on a unit basis approximately 2,880 store closings were announced as of the end of April, more than twice as many closings as the 1,153 announced during the same period last year. Historically, roughly 60% of store closure announcements occur in the first five months of the year. By extrapolating the year-to-date announcements, CS estimated that there could be more than 8,640 store closings this year, which will be higher than the historical 2008 peak of approximately 6,200 store closings, which suggests that for brick-and-mortar stores stores the current transition period is far worse than the depth of the credit crisis depression.

While there was more in the full analysis, the bottom line was simple: there is just too much retail real estate as Urban Outfitters CEO Richard Hayne admitted this past March, when he said “Thousands of new doors opened and rents soared. This created a bubble, and like housing, that bubble has now burst.”

The excess retail space means that North America has a glut of retail outlets, as well as far too many shopping malls, something which is becoming apparent as sales per capita decline. As we further showed in the chart below, on a per capita basis, the US has roughly 24 square feet of retail space per capita, more than twice the space of Australia and 5 times that of the UK.


“The excess retail space means that North America has a glut of retail outlets, as well as far too many shopping malls, something which is becoming apparent as sales per capita decline.”

why go to a mall when you can do it all online?..the jobs are gone..disappearing before our eyes..

shh luddite.. *sarcasm


~ by seeker401 on June 7, 2017.

2 Responses to ““A quarter of all malls will close over the next five years””

  1. Reblogged this on World4Justice : NOW! Lobby Forum..

  2. Luddites Indeed. 🙂 Amazon distribution centers keep opening here in Illinois.

    Seems to me, at least where I live in Illinois, it’s a big land grab for the new and improved 21st Century Housing Projects. Senior Housing and Youth Centers combined, is the suggestion for one of our large, now closed down, malls, and also for any future malls when they too, stop pretending to be renovated, as this one did after they tore up the parking lot, put a fence around it and parked a large piece of construction equipment which never moved. Another mall recently announced it too would be closing in 2018, and they are claiming they are going to make it an amusement park, lol….which is absurd if you saw where it is and how congested and busy that suburb already is. My guess is, it was a very creative lie, but we’ll see.

    I’m wondering if those youths aren’t going to have to do service work for the seniors, while the non-profit ‘ones’ collect big government checks from grants and taxpayers’ ever rising property taxes. I know one thing, old people don’t care for all the noise of a youth center, so this is one very sorry ass idea. I’m sure once enough money is made off them, this idea too, will eventually FAIL!


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