CBL & Associates have become the latest mall owners to file for chapter 11 bankruptcy, they operate 107 properties across 26 states plus a few outlet malls. As online stores flourish, many brick and mortar retail businesses have struggled over the last few years, a process only made worse for these retailers with the Covid-19 pandemic which saw nearly all indoor shopping malls close during the spring and summer seasons. This has lead to many filing for bankruptcy and missing rent payments to mall owners such as CBL & Associates.
CBL & Associates had previously announced they were entering into a debt restructuring agreement with some of its bondholders. CEO Stephen Lebovits said in comments about the plan, “After months of discussions and consideration of a number of alternatives, …implementing the comprehensive restructuring… will provide CBL with the best plan to emerge as a stronger and more stable company.”
CBL runs B-level rated malls mostly, while Simon Property Group owns mostly A-level rated malls. A level rated malls tend to have more known brands, higher end brands and get a better price per square foot for retail tenants. Large and small retailers have been struggling including long established and well known brands like J.C. Penney who also filed for bankruptcy this year. Strip malls, outlet malls and outdoor malls have faired much better as many saw increased sales while their indoor mall counterparts suffered.