One of the effects of the New Crown pneumonia epidemic is a resurgence of interest in suburban living among Americans.

After years of urban growth, one of the many effects of the Newcastle pneumonia pandemic will be a resurgence of interest in suburban living among Americans, according to the CEO of Simon Property Group, a top U.S. shopping center developer.

Simon Property's best-known properties include the Roosevelt Field shopping center on Long Island, New York, and the King of Prussia shopping center outside Philadelphia. The group has built an empire of upscale shopping centers in affluent American suburbs. Simon Property's focus on high-end properties and better maintenance of its shopping centers has spared it from the worst effects of the decline in shopping center traffic in 2020 - several developers have gone bankrupt as a result. But Simon Property still saw a decline in revenue.

This is further exacerbated by the renewed migration of some affluent Americans to urban centers, a trend that David Simon, son of Simon Properties' founder and CEO, said on a conference call with Wall Street analysts on the evening of Feb. 8 is overstated.

He said, "The ultimate question about urbanization two, three or four years ago was, why do suburbs still exist? Everyone is going to live in urban environments, blah, blah, blah. I'm telling you, the suburbs are going to be popular, and our prime real estate is going to be the focus of the market."

Leaving aside the data that can prove the rebirth of urban centers over the past 20 years, even if there is a boom in the suburbs where Simon Property's shopping centers are located, a bigger question is whether developers can adequately reinvent these properties because of the changing retail landscape?

Shopping center developers must adapt to new patterns such as the rise of online shopping and the shift of customers from department stores to single-row commercial district retailers like Target and Ulta Beauty. They must also replace many of the retailers that are closing stores and seeking bankruptcy protection. (Simon Properties was one of the companies recently involved in the acquisition of Penney's in federal bankruptcy court. 2020 also saw the group acquire bankrupt Forever 21, Brooks Brothers and Lucky Brand, among others.)

Aquis 毛巾

Aquis 毛巾

For now, Simon Properties appears to be holding up. spring 2020 was tougher, with Simon Properties tenants such as Gap Inc. falling behind on rent after closing stores for weeks on end. And since then, Simon Properties has collected 90% of the rent for the past three quarters. The group announced on Feb. 10 that it had reduced rent for tenants by about $400 million and extended another $310 million worth of rent.

David Simon believes that even though retail spending is starting to recover, especially in big-box stores and single-row strip malls as it did during the recent holiday season, it will still take some time to return to normal, as many retailers remain "generally cautious.

The process will take time," he said. Simon Property ended 2020 with an occupancy rate of 91.3 percent, which is relatively good overall, but still down from 95.1 percent a year ago.

The good news for Simon Properties is that many retailers are once again showing signs of recovery, and some are even doing brisk business. Dick's Sporting Goods, for example, which is typically a regular tenant in single-row commercial areas, is now fighting to move into Simon Properties' shopping centers. Simon said, "The [retailers] that want to expand their business are excited." Another single-row commercial district retailer in talks with Simon Properties is Kohl's.

Another reason supporting Simon's modest but optimistic attitude is that as some markets begin to ease restrictions related to the Newcastle pneumonia outbreak, Simon has seen signs of a rebound in those places, particularly Florida and Texas. This leads Simon to believe that things will get better in 2021.

Are we completely out of the woods? Not yet. But we're moving in that direction."