Mall stocks fall following record retail decline

The price of Washington Prime Group’s stock declined by 15%, Macerich dropped 13%, CBL fell 11%, and Simon receded by almost 10% the day after a record 8.7% decrease in March retail sales was reported.

The Real Deal’s New York real estate report observed that Nareit’s regional mall index was down 9.32% on Wednesday, the largest daily drop tracked among all REIT indices tracked by the industry group. Its All REITs index, by comparison, fell by 4%.

REITs had outperformed the broader market after the Federal Reserve announced new relief and lending programs to individuals and businesses, but that positive effect was overcome by the dramatic drop in retail sales. 

In the previous week, capital spending cuts, extended credit appeals, and employee furloughs were announced by several big mall owners, including PREIT, CBL,  and Simon.