Struggling retailers rack up $ 52B in missed rent during pandemic

Plans to push bills to next year will make recovery even tougher.

Eight months into the pandemic, clothing stores, restaurants, gym sand other businesses find themselves in a $ 52 billion hole.

That’s the total amount of retail rent that’ s been missed since April, according to the analytics and marketing firm Costar Group. Though some of the overhang has since been paid back, the remainder will be a drag on merchants as they try to rebuild and landlords demand their money. In some cases, the unpaid balances could drive them into bankruptcy.

Overdue rent compounds the problems these companies have faced this year, including lost sales during shutdowns, consumers’ reluctance to return to stores and restaurants and the long- running migration of shoppers from brick- and- mortar locations to online venues.

Many of these unpaid bills won’t go away but are instead being pushed into next year.

Costar estimated missed retail rent, including payments from store chains, restaurants, gyms and bars, in each month using its own data, industry statistics and landlords’ public reporting. The figures don’t account for any back rent that may have been repaid in subsequent months. In all, retailers paid $ 146 billion in rent from April to November, Costar said.

TI AA Real Est at e Account , run by the giant Teachers Insurance and Annuity Association of America, said in a Nov. 10 filing it received more than 1,000 requests from tenants for rent relief, primarily among retailers, with most asking for deferrals of less than six months.

So far, the amount of rent collected from retailers climbed from 54% at the end of April to 86% this month, according to Costar. Malls have fared worse, with only 79% of rent due this month received. That makes the situation critical for landlords, too.

“It’s going to take a period of years, not months, to get through this,” said Michael Hirschfeld, vice chairman at JLL, a real- estate services firm.