Four stores at Brickell City Centre — Adolfo Domínguez, Emporio Armani, Musart and Stuart Weitzman — have closed permanently, a Swire spokesperson confirmed. BCC attributed some of the closures to the coronavirus pandemic.
“We have been prepared that some retailers may close or accelerate their closures as a result of COVID-19. It is an unfortunate result of this unprecedented pandemic,” said a Swire spokesperson by email.
But one tenant said problems emerged prior to the pandemic. The tenant, who asked to remain anonymous for fear of reprisal, blamed rising rents and lower-than-expected foot traffic.
“I got evicted as I couldn’t pay rent in full. Nobody can,” the tenant said. “COVID just accelerated the process. It was the icing on the cake.”
The tenant said he put down $75,000 in deposits and spent another $250,000 to build out his space. He saw increasing revenues: $328,000 in 2017, $452,000 in 2018 and $484,000 in 2019. But the number of transactions fluctuated, growing from 3,344 in 2017 to 3,886 in 2018, then dropping to 3,355 in 2019. Meanwhile, rent rose from $50,000 in 2017 to $60,000 in 2018. In 2019, rent was $110,000 plus 16% of sales in 2019, or $7,500, he said.
“I had a tremendous increase in rent while the traffic has gone down,” the tenant said.
The mall declined to comment on rents but said it had seen double-digit growth in foot traffic between its 2016 opening and the end of the year in 2019, with a 17% year-over-year increase from 2018 to 2019. Brickell City Centre uses wireless beacon technology to measure the shopping center’s foot traffic, said David Martin, vice president of Swire Properties.
Store closures are normal at a new mall, Martin said in a December interview. “Any mall as it evolves will have openings and closings.”
A mall spokesperson said via email that a roster of new retailers will be announced soon.
“Each of these new retailers remained steadfast on their opening timelines despite the delays from COVID-19, a promising sign of the resurgence and resilience of retail in mixed-use open-air shopping centres such as BCC.”
BCC reopened some stores last week with limited hours and COVID-19 protocols similar to those at other Miami malls. Its restaurants will open for dine-in service Wednesday. First weekend foot traffic met expectations, a spokesperson said.
“Several retailers reported strong foot traffic and sales, with some exceeding their sales goals. We expect traffic will ramp up further as our restaurants open for dine-in service.”
The store closures are a precursor of the challenging local retail landscape that will likely struggle for the next 12 to 18 months, said Beth Azor, founder and head of the Weston-based Azor Advisory Services.
“These luxury stores don’t see the foreign travelers coming in and buying these high-ticket items. And their customers are going to be significantly decreasing in those numbers.”
Luxury malls and shopping areas — such as Aventura Mall, Bal Harbour Shops and the Design District — will have to compete for the luxury consumer market in South Florida, she said.
“The luxury consumer is there, but I don’t know if the South Florida consumer is enough.”
Retailers elsewhere in Miami are struggling to keep their doors open, including small business owners, said Michael Comras in early May. Comras, one of South Florida’s largest commercial landlords, said he’s seeing some retailers and restaurants close their doors permanently.
“This has propelled the demise of some of our great brick-and-mortar retailers,” he said.
But some brands and retailers are seeing a rise in activity, Azor said. Pizza vendors, Target, Walmart and home supply stores such as Home Depot are performing well because they “cater to lower-priced items and are offering curbside pickup.”
Source: Miami Herald