By Denise A. Valdez
SOME shopping malls in Metro Manila will be closed starting today, after the government urged mall operators to suspend operations during the month-long “community quarantine” to prevent the spread of the coronavirus disease 2019 (COVID-19).
Listed property companies, which generate significant revenues from mall leasing operations, are expected to take a “huge” hit due to the month-long closure.
“(The) impact of mall closures, in a word: Huge!” PNB Securities, Inc. President Manuel Antonio G. Lisbona said in a mobile message over the weekend. “Our analysts are still quantifying exactly how much but foot traffic is the lifeblood of malls. Without people, it’s hard to do business.”
Ayala Land, Inc. (ALI) on Sunday announced it is temporarily closing its 16 malls in Metro Manila “in the interest of health and safety” until further notice.
SM Supermalls, Inc. announced late Sunday all of its malls in Metro Manila will be closed starting today until further notice.
Villar-led VistaMall and Starmalls also announced the temporary closure of its malls in Metro Manila. Vista Mall has four malls, while StarMalls has two — Alabang and EDSA-Mandaluyong.
“Drug stores, home essentials, hardware needs, banks and restaurants will remain open,” VistaMall said in a statement.
Robinsons Land Corp. (RLC) said late Sunday it is temporarily shutting all of its nine Metro Manila malls starting today until further notice.
SM, ALI and RLC said supermarkets, drugstores, convenience stores, banks and other establishments that offer basic services will remain open.
The mall closures are expected to drag the property giants’ bottom line.
ALI generated P22.02 billion in revenues from shopping centers last year, out of the P168.8 billion in total revenues. It has 2.12 million square meters of gross leasable area in its mall network across the country.
For SM Prime Holdings, Inc., revenues from malls stood at P63.63 billion in 2019, representing 54% of total revenues of P118.31 billion. It operates 74 malls in the Philippines with a total gross floor area of 8.5 million square meters, of which 42% are located in Metro Manila.
RLC’s mall operations generated P13.25 in revenues for 2019, comprising 43% of the company’s total revenues of P30.58 billion. It has 52 malls in its portfolio with 1.57 million square meters of gross leasable area.
“Recurring income from their malls provide a significant portion of the bottom line for some of our major property developers. This is expected to greatly hit their income for the first half of 2020,” Trader Gab L. Magsino said in a text message.
Trade Secretary Ramon M. Lopez told reporters yesterday that the interagency task force will be meeting on Monday for the guidelines on mall operations. He added that the “econ(onomic) cluster will announce (a) government support package” by today, but the details of which he refused to preempt yesterday.
Regina Capital Development Corp. Head of Sales Luis A. Limlingan said mall operators and retailers may see an upside as consumers resorted to “panic buying” ahead of the lockdown.
“For those malls, there will be an impact but it’s hard to calculate. On the one hand some retail will be affected if they deal with non-essentials, but since these developers have groceries, drugstores and essential appliances, the surge in sales will offset the slump in others,” he said in a mobile message.
Pending the government’s final guidelines on restricting mall operations, other mall operators have adjusted operating hours to close shop at 7 p.m.