Malls Face Catastrophic Hit in Canada With Unpaid Rent Surging

Canada’s malls are facing a wave of skipped rents and could see vacancy rates triple by year-end, with the coronavirus poised to leave its scars on a fragile retail sector long after the pandemic ends. In the country’s enclosed regional malls -- a category that includes Toronto’s Eaton Centre and Pacific Centre in Vancouver -- only 20% to 25% of tenants paid rent in April, according to brokerage firm JLL Canada, Bloomberg News reported. Big box shopping centers and community strip malls took in only a little over half their expected rent. “I’ve been in this business over 30 years and I have never seen anything as catastrophic or as impactful in a negative way in our business,” Tim Sanderson, who heads retail at JLL Canada, said in an interview. “It’s the mid-tier smaller-scale landlord that cannot make their mortgage payments to their lender that are going to be in trouble.” Malls and main-street shops, bastions of community commerce, were already under pressure after two years of weak retail sales, rising property taxes and the shift to e-commerce. Read more