Retail Space Evictions Accelerate Across US
Retail property landlords are initiating eviction and lease-cancellation proceedings across the country as tenants continue to grapple with COVID-19-related losses even after losing government-imposed protections against eviction, the Wall Street Journal reported Tuesday (Sept. 1).
As an example, the report cited a Miami landlord that has moved to evict Saks Fifth Avenue for allegedly failing to pay $1.9 million in rent.
“We hope and think that the outcome of the lawsuit is that Saks would come to its senses and pay its rent in full. If Saks still doesn’t do so, we’ll have a whole host of other options for the space,” Matthew Whitman Lazenby, chief executive officer of Whitman Family Development, told the Journal.
The Journal quoted a Saks spokeswoman as saying: “Unlike the majority of our landlord partners, Matthew Lazenby and the Whitman family have not acted in good faith. Not only have they chosen not to adequately assume their fair share of the damages created by the global health crisis still gripping our nation, they have used the press and legal system to bully tenants.” The Journal said the spokeswoman added that Saks Fifth Avenue and other companies have worked “to amicably and logically share the losses incurred during the pandemic.”
Nationwide, retail landlords collected 77 percent of rents owed in July, compared with 54 percent of rents owed in June, according to Datex Property Solutions data cited by the Journal.
The newspaper quoted real estate attorneys in several parts of the country saying they are beginning to begin more eviction proceedings on behalf of landlord clients. Lawyers told the Journal most tenants facing eviction find a way to pay the rent they owe.
Trouble between retail landlords and tenants in the United States began in the early months of pandemic-related closings in the country and involved some of the biggest names in retail.
In the residential rental sector, a source of potential stability for landlords and tenants alike could be the use of what are called “flexible rents” made possible by FinTech.