The only thing more dangerous for America’s malls than a string of apparel-chain bankruptcies is when the trouble hits department stores.
Retailers like J.C. Penney Co. and Macy’s Inc. are considered “anchors” that keep malls humming and foot traffic flowing. They’re so important to the ecosystem that smaller tenants may refuse to set up shop without a promise that the anchors will stick around: Many leases include so-called co-tenancy clauses that let them cut and run or pay less if those key tenants depart.
Now, many landlords are pushing to eliminate or narrow the escape clauses in the wake of mass department-store closings. That means less flexibility for the remaining tenants.
“Most retailers based in a mall do live or die based on an anchor,” said Andy Graiser, co-president of A&G Realty Partners, a commercial real-estate adviser. “Certain retailers are going to have a risk if certain anchors go away.”