Photo: Simon Property Group
Will shoppers go to the mall because Simon says it’s okay?
Simon Property Group is preparing to reopen its malls to customers in 10 states. An internal memo sent to retailers and leaked to media outlets outlines the mall operator’s plan to reopen 49 facilities between May 1 and May 4.
Business hours at the malls located in Alaska, Arkansas, Georgia, Indiana, Mississippi, Missouri, Oklahoma, South Carolina, Tennessee and Texas will not immediately return to their pre-pandemic norms. The shopping centers will be open between 11:00 and 7:00 Monday through Saturday and 12:00 to 6:00 on Sunday, allowing cleaning crews more time to sanitize door handles and other surfaces throughout.
Each mall will offer free infrared temperature testing for customers and CDC-approved face masks and packets of hand sanitizer for shoppers to wear. The mall operator is taking steps, including limiting the seating in food courts and keeping play areas closed, to try and maintain proper social distancing. Simon employees are required to wear masks (customers are encouraged to do so) and to take frequent breaks to wash their hands.
It is not known how many retail tenants plan to follow Simon’s lead and reopen stores. Many retailers, particularly department stores and specialty clothing chains, have been hit hard by store closures, and some have withheld rent payments in an effort to maintain liquidity. Even those reluctant to reopen in states where the number of confirmed COVID-19 cases and deaths continue to climb may feel they have no choice if they wish to remain viable as a business.
The other question that remains is whether shoppers will return to mall properties in a significant way. Shopper traffic at malls, in general, was falling well before more than a million Americans were infected with the novel coronavirus. Will they be just as willing to go now?
- The biggest US mall owner prepares to reopen 49 properties. Here’s how that will work – CNBC
- Biggest Mall Operator in U.S. Plans to Reopen 49 of Them – The New York Times
- Simon Property to reopen malls and outlets across the nation – Atlanta Journal-Constitution
- Simon Property Group Temporarily Closes All Domestic Properties – Simon Property Group
- Are retailers and landlords destined to head to court over rents? – RetailWire
Discussion Questions
DISCUSSION QUESTIONS: Will shoppers go to malls once they reopen? Do you think Simon Property Group is taking the proper precautions to safeguard the health of shoppers and workers in these facilities?
Poll
BrainTrust
Mark Ryski
Founder, CEO & Author, HeadCount Corporation
Bob Phibbs
President/CEO, The Retail Doctor
Yes, some shoppers will go to the mall. Whether it’s to shop or just to do an activity that feels normal, if they open, people will most certainly come. The bigger question is, how many will come? Simon Property is doing the best they can to follow the guidelines, but I think this is going to be challenging to execute if people come to the malls in larger numbers. The other big question is about the retailer tenants. No question all retailers are anxious to open their stores, so I’d expect that many retail tenants will make every effort to open as best they can. While I think this is an encouraging step, I’m not yet convinced that it’s completely safe.
If governors in the respective states have approved non-essentials to open up, then it is game. How enthusiastic the shoppers will be remains to be seen. But Simon seems to be taking all the required precautions.
If Walmart and Costco are operating, busy and as thriving as they have ever been, I don’t see how a mall environment is any more risky, with the same or better level of precautions. For instance I don’t see either Walmart or Costco offering masks or infrared temperature checks yet.
Mark and Suresh:
You have covered the pertinent points. Somebody has to step out and establish reasonable guidelines. And we can expect all businesses to follow them as published. Whether consumers choose to take advantage of that opportunity is up to them. As to the discussion question posed, “Do you think…” Well, this is an opinion forum and nobody has more opinions than me, so I guess that’s OK. But my opinion on this question is that no one writing regularly on this site has the answer to that question. Just like consumers and business owners, we are all going to have to follow our own best judgment on this one.
It depends on where you live. There is a big disconnect between states where the pandemic has hit hardest and those that have not yet experienced the wave. The question is will the wave be a mild swell or a tsunami. For many retailers to survive they must open with restrictions and safeguards. I believe Simon should offer gloves as well as the masks and hand sanitizer. It will be interesting to see if we have pent-up shopping demand once we open back up. Will off-price be a big winner as it was after 9/11? We shall see.
Unless Simon/other malls can prove that malls are a safe space, no thanks. Optional thermal testing? No, thanks. Mandatory testing is what will make other shoppers feel safer. Are the masks required? If not, again, no, thanks.
Malls do have a unique opportunity to give consumers a safe place to roam around in public, but there must be more mandates and less suggestions for this to be a reality.
The thermal testing has been shown to be essentially worthless, given the high proportion of asymptomatic cases. It’s a “safety theater” move. And far too many people are still walking around without masks. What kind of insurance rider is Simon having to pay for when someone inevitably gets sick and/or dies from being in one of their malls?
I’m assuming that one of the malls Simon plans to reopen is the massive Galleria Mall in Houston — almost 2.5 million square feet, and the busiest mall I’ve visited in a long time (last fall). People are eager to emerge from their caves, no doubt, but Simon faces some big hurdles convincing shoppers that the Galleria and other malls have the right health protocols in place. How do you police the foot traffic (and thus the lack of social distancing) in a huge facility with multiple entry points? How do you ensure that every surface is adequately sanitized?
Bottom line: It’s not just about when Simon wants to reopen, but how well its tenants (and its own management) are prepared. It will take some time and some convincing to bring the customers back, even to the strongest malls.
Not until there’s a vaccine. No. People do not know how to practice social distancing in malls. Certainly not where I live, and it’s fair to say not in many other cities. Can’t fix ignorance and I don’t think the non-ignorant will want to play
For those of you who doubt what I’m saying, or think I’m being alarmist … I had to call the police to my house this morning over some issues with a neighbor. Of the four that showed up, only 2 were wearing masks.
If law enforcement can’t do it, do you really think the average person is going to? To go shopping?
We see too many examples each day of people in high places telling us what to do to be safe; but they are not doing anything they tell us to do. Do as I say and not as I do. So what should we expect except what you experienced?
Some will and some will not. Our own surveys show that consumer opinion is very split on this issue with many being afraid to venture out, and some positively chomping at the bit to be allowed back into stores. One thing that comes out clearly is the fact that enclosed malls are one of the retail spaces consumers are most fearful of, so there is quite a lot of convincing to do to get people to return.
Ultimately, it’s not just a matter of getting people back through the doors. You also have to get them spending which will be quite a task given the amount of damage done to people’s finances and confidence during this crisis.
Retailers deciding to open does not equal shoppers shopping. Shopper confidence has been shot from an emotional, physical, and financial perspective. Recovery will take time. Most shoppers will likely be reluctant to shop not knowing what retailers will be open. Here in Georgia, some non-essential businesses opened this weekend to lines and some had zero shoppers over the weekend. Opening right now is a crap shoot.
I think a lot of shoppers will do a wait-and-see for a few weeks before they venture to a mall. Also, how will the mall police the capacity limits? Here in Texas we have a 25 percent capacity cap right now for a few weeks.
The response will vary geographically, demographically, and yes, politically, as I watch in cynical amazement.
This is kind of like being a freshman at your first high school dance. The dance floor looks interesting but do you have the courage to step out there and join in the apparent fun? There’s hesitation and for some downright fear. For others, they can’t wait to get out there and express themselves.
In our case, the mall as dance floor also has its own concerns. This dance is among a variety of consumers with a wide ranging risk appetites and a mall operator hoping to have brought the right tunes to create a safe environment that suits who shows up. Things will be touch and go at first, but we’ll slowly start warming up to the possibilities; it’s going to be a long night and we may need a few dances under our belt before we shed our freshman inhibitions.
People want to get out. They want to resume life as “normal,” however we’re still a long way from that. Even with malls opening, the guidelines for healthy safe behavior have changed. Shoppers will have to adapt. Stores and malls will have to enforce safety. The risk of backsliding right now is too high. There is a line in the sand that Simon and all mall owners/management companies must draw – and it can’t be crossed by shoppers or retailers.
Yes, the stores’ and mall operators’ willingness to enforce safety is the key. How many retailers are accustomed to turning away customers, or removing fixtures, in order to maintain safe social distancing? It’s not in their DNA.
Enforcement is the real key. However, how much enforcement is too much? Do mall employees need the ability to tell customers who aren’t properly social distancing to leave the mall? And if they refuse? If this escalates does the situation get worse or better? Perhaps the best answer is to limit the number of entrances and limit the number of people allowed to enter at a time, much as essential retailers have been doing to date.
On the other hand, would you have wanted them to say they were going to have armed guards and unless you came in with a mask and had a temperature check you would not be allowed in, and that they had added social distancing agents to police the six-foot rule throughout?
To those thinking we can keep American retail closed until there’s a vaccine, why haven’t we seen Target and Walmart become hot beds of COVID-19 with all the people who have been walking in and out without masks, gloves, or social distancing for months now? Wouldn’t you have thought that those precautions would’ve been needed to end up with that result?
There has to be a balance we have to arrive at in order for normality to return; not at any cost, but we will never have zero risk on anything.
I think there will be people that go to malls because they want to get out of the house. Whether or not that turns into sales is another question – I still struggle with thinking there is really pent-up demand for non-essentials at this point in time.
Yes, the death count (which continues to rise) will not give consumers cause for free-spending celebration when it’s safe to go back to the mall. And the economy is not going to bounce back quickly, either.
I already know one “friend of a friend” (not a personal acquaintance) who passed away, and learned yesterday about eight family members of two friends who had the virus — none of whom was tested, by the way. As time passes, I think the impact on each of us personally will grow, even if we’re lucky enough to avoid the infection ourselves.
I have noticed with each trip I make to my local Target that no one, and I’m not exaggerating, is shopping the non-grocery sections of the store. During my own visits, I have pushed my grocery-filled cart past those depts on my way to check out just to see if there are shoppers there. I have yet to see anyone other than in electronics (no doubt trying to improve their home office and entertainment options). That’s very telling to me.
Consumer traffic returning to malls will be a trickle not a flood and very few consumers will go to hang out and browse like they used to. If anything, malls being open may make it easier for retail tenants to move some of their currently stranded inventory to off-mall locations or into their e-commerce fulfillment flow.
Up until now Walmart, Target and Costco shoppers have been operating in a state of “high alert.” I’m nervous that when malls open it will provide an artificial sense of a return to normal, even with all the precautions in place. It’s no secret what is going to happen if we relax too much too soon. I’m afraid it’s a lesson we are about to learn the hard way.
Some shoppers, tired of delivery and curbside pick-up options, will return to the mall. People are bored and some will be interested in returning to what was once a comforting environment. The first to reopen, this could actually spur a comeback for malls if they handle it correctly.
Personally, I will take a wait-and-see approach before I head to the mall. I’m with Paula on people not knowing how to properly social distance because that has been my experience at the grocery store. For now, I will feel safer shopping with indie retailers who have more skin in the “following safety compliance to the letter” game.
As long as the media continues to beat the drum about how awful the virus is, many folks will stay away. If I have to go to the mall and be greeted by a squad of folks making me have my temperature taken, wearing a mask, and sitting away from my friends if I want to eat, then forget it. This should never be considered the new normal, and for those who think different, fine. We have a trip planned for October, and if they require face masks on the plane and when you arrive, and the city forces everyone to wear masks, I’ll stay home. This needs to end soon, and if it doesn’t, malls, event centers, and restaurants will close their doors. Our economy will crumble, and our dependency on government will spiral out of control. I love my freedom, and this will not end well, if we choose to continue on through the summer months and beyond.
In the past, the goal was to make the shopping experience as easy and simple for the customer as possible. Things like temperature checks, masks, gloves, and reduced hours of operation create a lot of friction. Does the shopper want to go to the mall badly enough to deal with all of that? I have my doubts. Will only certain mall entries be open too? Add to that a long walk for parking.
The issue here is these malls HAVE to open back up. The companies are running out of money. The mall owners have debt payments, property taxes, and maintenance to pay and need rent revenue to pay that. The retailers need to open back up and get inventory flowing again if nothing else than to switch out Winter/Spring stuff for Summer stuff. The employees want to go back to work as it is easier to go work and get paid for it than screw around with the unemployment system (in my state, Nevada, the State Unemployment System has been steadily broken and many who apply for unemployment have been unable to get it because the system keeps crashing and the director of that state agency who was appointed by the current governor 01/2019 just resigned last week).
But will the customers come back to shop? That remains to be seen, and I am not so sure. Many others are unemployed and worried about their livelihood. But these malls and retailers have got to do this or they will not survive. They (as in the mall owners, the retailers, and the employees) cannot afford to wait another few months, plus the media is already telling us the virus will come back in the fall and sensationalizing that it will be “worse than ever” oh and the normal seasonal flu will hit at the same time. Will everything have to be closed again in the fall?
I think the mall operators are very nervous to be closed more than about 2 months. Customer habits take time to form/re-form and a little over 2 months is the magic number for habits to form or go away. If a customer goes 2 months and lives just fine without the mall, or without Macy’s, they may well realize they can live without those things forever.
Plus all this time Walmart and Target have been open and able to sell clothing and general merchandise items in most states. I don’t think it was even fair to force the mall stores to close. The government picked and chose who got to sell what items during this pandemic, simply because some had “food” and were deemed “essential.” Part of the issue is the mix of stores in US malls is very narrow. If you go to a mall in Canada you are likely to see a produce seller, a Dollar Tree or Dollarama, a bakery/bread shop, and often a drug store/pharmacy housed within the mall. Would that be enough to have made malls essential and allowed to stay open?
These are all excellent points. In my opinion, however, many people find it too easy to blame the media for raising the alarm bells, Maybe they have, but isn’t this what the media are supposed to do? We are in a public health crisis unlike any seen before. It’s not a media exaggeration to say so. No government makes the decision lightly to order retailers and businesses to close. Let’s also remember that all businesses are being impacted, not just retail. Large corporate campuses are sitting empty right now as those employees work from home. Retail is particularly harder hit since there is no “work from home” option for store associates. (Although anecdotally I have talked with small retailers leveraging associates at home to sell virtually through video streaming and other options in a manner that drives digital sales, that is a different topic completely).
I would point out my own observation about the Targets and Walmarts of the world selling non-essential goods in stores. I have yet to see any shopper buying those goods in my local Target. It’s just one example, but it tells me consumers in my area are not interested in buying those products right now.
I agree we can’t keep everything closed indefinitely or the economy collapses out from under us, but what cost in human lives is too high to pay for that? The only way to re-open is to enforce limits. Many consumers will resist that, and unfortunately, those constraints must be enforced or everything we have already accomplished with these closures will be for nothing. Will there be another surge in the fall? Yes, science tells us that absolutely will happen without a vaccine. Will we have to close stores again? That depends on how strong the surge is and how effective we were up until now at enforcing social distancing constraints and generating enough testing and tracing. If we use the intervening time to train ourselves to accept those constraints, be they masks, gloves, social distancing, whatever is necessary, then it will be easier to tolerate whatever is needed in the fall. None of us here on this forum are experts in the requisite medical science needed to draw conclusions on this issue and it is to all of our advantages if we listen to those health experts and take a metered approach to re-opening. We will re-open, but the risk of doing it too quickly and in an uncontrolled manner will cause far greater repercussions later on that will outweigh being closed right now. And that includes being forced to close for even longer periods of time later. Who wants to see that happen?
At the end of the day, this isn’t about being too dependent on the government. It’s the government’s job to handle health crises like this whether or not we like the methods. Otherwise, we risk the entirety of society breaking down, not just economically!
You have to start somewhere, and yes some percentage of shoppers will go. But as Paula points out — we’re a vaccine and/or a treatment away from even remotely heading towards the new normal. But kudos to Simon for doing this in an organized and thoughtful manner. There are a lot of fields of dreams for re-openings — malls, restaurants, etc. They can open, but will customers come?
During a focus group discussion on retail space/safety, we asked for opinions about shopping in centers. Most of the opinions in this conversation were voiced. One shopper told us all: if “I shop in the huge grocery stores, what basically is the difference? Everyone is telling me that they do everything to keep it safe. I’ll go to the mall.” I think that sentiment will grow with time and experiences.
Exactly Rich, it is not like the Black Death and everyone has fleas we need to avoid. Prudence, sure, but much is bordering on paranoid at this point.
The reason people will avoid the mall in the future isn’t because they are scared to go there (except the few people who are still believing all of the sensationalizing the media is doing), but because they are having financial concerns and do not feel the need to spend money on what the mall is selling. Maybe they are working from home and no longer need to buy work clothing as frequently. Maybe they are socializing less often so no longer need to buy new clothing to go out with friends.
I would actually venture the mall is safer than a grocery store or a Costco for sure (which have people getting very close together due to layouts and certain categories of product being in such high demand), and also generally safer than a Walmart or Target. There is much more space in the mall for people to spread out and not be in close proximity. There are many restroom facilities to choose from so you do not risk virus capture in that single crowded Target restroom that is being used by dozens of people in an hour and only has a few stalls and a hand dryer that is blowing who knows what germs everywhere in the air almost constantly due to the crowd.
I believe there’ll definitely be a little bounce-back in terms of shopping, but a return to pre-COVID-19 levels is a way off and may never be the same. Aside from that, the main element of any “rule” to me is enforcement. What is going to happen if the social distancing rules are broken, for example? Are the mall cops going to run in and break it up? What if the state requires a mask when you’re out of your home? Is a mall cop going to kick you out if you don’t have one? Is Simon ready for enforcement? Fun times ahead.
I’ve had social distancing rules violated so many times in grocery stores and Walmart/Target Stores during this pandemic. Other customers who get right next to me as I am looking at a shelf or reading a label, employees who come get right next to me to approve a self checkout alert (I step back), employees who are stocking and come up right next to me … I move away, but….
I noticed when people started wearing masks, they stopped following the social distancing guidelines. I do not think a mask cancels out the social distancing rules. The mask was supposed to be in addition to the social distancing guidelines.
I would assume the malls will need to enforce group size limits. It needs to be posted, based on either the local guidelines or some pre-set guideline the mall operator comes up with. Given the malls likely won’t be very crowded, I don’t think it will be too hard. If the malls get crowded, it will be very hard.
And don’t even get me started on the masks and how often people touch them, take them on/off, etc. No hand washing or sanitizer in between. Huge mis-use of masks.
According to Statista, two-thirds of Americans would be “nervous about leaving home if business resumed” (as of 4/19/20). That leaves about one-third who are not concerned.
Even though protective guidelines are recommended for patrons of these malls, there are no guarantees shoppers will abide by them. I am thinking of COVID-19 deniers, protestors, and governors who reluctantly shut businesses. These early (premature?) openings may not be the best examples of how to move forward, or even what the future of shopping will look like.
I agree with those that suggest too many shoppers are not conscientious about maintaining social distancing and wearing masks (masks are key to cutting transmission). So in my opinion as long as Simon “only encourages the wearing of masks…” I believe it is not only a mistake but will lead to increasing infection rates and potentially leading to new “hotspots” and setting us back. This is where I believe mayors, counties and governors should follow the lead of countries like New Zealand and Germany that REQUIRE MASKS and enforce with fines. Let’s get real, “freedom” does not mean one has the right to risk the health of others! That’s why we have speed limits on highways – one is not “free” to drive as they please. So I’m an SPG shareholder that is disappointed.
Okay, in a perfect world, you are correct. But the masks have to be used properly. And the right mask has to be used. People cannot be re-using masks. Disposable masks are one time use. Once you touch that mask it is done. Using a bandana or cloth in lieu of a mask doesn’t cut it. I am in the US and the majority of people going around have a bandana or cloth around their mouth, some not even covering their noses. Some of us do have actual masks on, maybe half.
In some of those other countries like Taiwan they produced proper N95 masks for all citizens and provide those. But in the US we still can’t really have those as public because there is a shortage in the medical field where those are badly needed.
How do you feel about the retail worker who is having trouble breathing with a mask on so they keep taking the mask on and off (usually on during an interaction with a customer then off again when they are stocking or even just between customers so they can breath). They touch that mask then touch your items at the cash register and touch your receipt. Is that sanitary? Nope.
If you open, will they come? The more pertinent question is: If you open malls and get 30 percent to 50 percent less foot traffic will retailers generate sufficient comp store sales to be profitable? Trust will have to be fully restored before consumers return in pre-pandemic numbers.
I agree with you, Joe, and am not convinced that enough shoppers will return AND make purchases to overcome the costs of keeping those stores open. That said, I am sure many retailers will say any sales that generate is better than zero sales. If one thing has been made clear, it’s that any previous belief that e-commerce meant the death of the store was sorely incorrect as we’ve now seen that e-commerce cannot replace the volume of sales generated by stores.
As bad as we want to get out and return to life as previously normal, I do not think we are ready to start window shopping in malls. With all respect to Simon, their words do not guarantee our safety. Maybe, if they limited the number of people allowed in at a time, it would increase the likelihood of our being safe.
Yes, there really is a mall in Alaska (Anchorage). Anyway, some will return, some will not — at least for now — and some will be in the “tried it but didn’t like it” category. The problems are 1) we’ve no idea the relative mix of the three groups, and 2) the very thing that is attractive to one group — lot’s of “activity” (i.e. people around) — makes another group nervous. And of course this is before all the rumor mongering — “mall vectors” true or not — and social media critiquing begins.
Here in Indianapolis, where SPG is headquartered, many of my retail friends were surprised by the announcement of opening the malls this weekend, when if fact, the Shelter in Place order doesn’t officially end until May 7th in our state. So at one level the move would seem to be a bit contentious as it countermands state laws. On another level, it is likely a good thing in that it potentially offers both shoppers and store employees a measured, step wise way to get the economy back up and running.
In my opinion, it is very likely that many stores will not immediately open, despite being permitted to. I also believe that it will take several weeks and even months before any level of normal traffic is seen.
I appreciate the steps SPG is taking to insure safety but it also my hope that shoppers continue to space, wear masks and take personal responsibility necessary to keep the virus from spreading, for the their own safety and the safety of the retail associates that staff the stores.
We have already seen how customers and retailers are handling this in grocery stores like Walmart, Target, and Home Depot. It will likely be no different in malls and the “non-essential” retailers who choose (or are required) to reopen. The differences we see now at currently open retailers in Atlanta vs. in a smaller town will be similar to the differences we will see in the malls in those places. Traffic will likely return, but at a small fraction of “normal” traffic. But it will be a positive psychological move and will begin our road to whatever levels of in-person shopping will exist going forward. Starting, in a reasonably safe manner, is critical. I applaud the effort.
Yes, Simon seems to be taking reasonable precautions and all tenants will need to do the same.
If you open it, they still might not come. According to the Prosper Consumer data from April, 2020, 15% of adults 18 years and older have said they will not be shopping in malls any time soon. That number actually jumps up to just over 17% for Gen-Z consumers and back to the market average for Millennials. When you pile on the fact that online/e-commerce will be seeing close to a 30% increase in the number of shoppers, it does not paint a very positive picture for shopping malls in the US. If we look at the recently released Prosper China data, the Chinese consumers also don’t seem overly anxious to shop in shopping malls as about 60% of adult Chinese consumers are taking a kind of wait and see posture. While the guidelines are laid out to get the economy re-started, it’s going to take more than just we’re open to get them to shop in malls.