USA Landlords & Retailers Play Hardball

Tapestry Inc Chief has been negotiating lower rents for the company's Coach and Kate Spade stores for more than a month, using the brands' power to draw in U.S. mall traffic as leverage in tough talks with landlords. The handbag company, is just one of a raft of major U.S. retailers seeking to lower rent bills to make sure they have enough cash to weather the COVID-19 pandemic. But with thousands of stores closed under strict lockdown measures and multiple national retail chains crumbling, mall operators' rent collections have collapsed, raising doubts about their future. Mall operators collected only 15% of April rent and trends are looking worse for May, according to CenterSquare Investment Management, which specializes in real estate. Retail rents in the United States have increased by 2.6% a year over the past three years, and currently average $21.80 per square foot, according to real estate analytics company CoStar Group. However, the coronavirus crisis has lead the firm to estimate retail rents falling anywhere from 8% to 13% in 2020.