Who’s paying rent and who’s not? (Staples paid!)
News outlets reported in early April that Sycamore Partners refused to pay April rents for its Staples stores during the pandemic, even though the stores remained open. Not true. As May began, 82% of the month’s rents for Staples were in landlord’s hands.
That’s the actual payment rate determined by Datex, a supply chain software and management solutions provider. Its Tenant Track of more than 1,000 shopping centers and tens of thousands of retail stores found that only 42% of total retail rents had been collected by May 8—exactly half the total collected on that same date in 2019.
Not surprisingly, essential service retailers allowed to remain open proved most diligent in paying their rents. Supermarkets, fast-food restaurants, drug stores, dollar stores, and DIY chains made the biggest showings in the 90% paid column.
Retailers that had paid 95% or more of their rents by the date: Albertsons, Big Lots, Chase Bank, Hobby Lobby, Office Max, Price Choppers, Rite Aid, Shop Rite, SuperValu, Target, Ulta Beauty, Wakefern, Walgreens, Wells Fargo, Whole Foods, and Wingstop. Sprouts Farmers Market was the only 100% paid-up tenant on the list.
The list of chains that had paid no rent at all by the 8th was longer. 24 Hour Fitness, AMC Theaters, Ann Taylor/Loft, Bed Bath & Beyond, Carters, Century 21, Cinepolis, Claire’s Boutiques, Dave & Busters, Famous Footwear, Five Below, Foot Locker, H&M, Harkins Theatres, Kirkland’s Home, Men’s Wearhouse, Old Navy, Party City, Regal Cinemas, Stein Mart, The Gap, and Tillys.
“This is very high fidelity data. It’s verified billing and collection data,” said Mark Sigal, CEO of Datex Property Solutions.
“This is a cash crisis and half the tenants aren’t paying, so we decided to open up this report and give property managers benchmarks in terms of the aggregate,’ Sigal said. “They are having to make determinations about tenants as to who can pay and who can’t. We wanted to set a threshold.”
As to how tenants can vary within a specific category, one need only investigate pet products. PetSmart had paid 80% of its rents by May 8, only 10% less than it had paid by that day last year. Pet Supplies Plus had paid 53% instead of the 99% it had paid the first week of May in 2019. But Petco, which had made good on 95% of its rent payments by this time last year, paid only 18% this year.