With hundreds of stores closing their doors to customers for good at a pace never seen before, the retail space available has reached uncharted levels. While this wave of retail stores closures started over a year ago, the unstoppable advance of coronavirus has proven the deadly kiss to commercial property worldwide. In the past few months, rising demand for urban real estate to support last-mile logistics gave some hope to struggling retailers’ landlords and commercial property owners. The idea was converting shopping centres, department stores, and even former flagship stores into distribution centres.

Simon Property Group, the largest shopping centres owner in the U.S. was reportedly in talks with Amazon to possibly take over former anchor department store spaces for distribution sites. Sources close to the matter quoted by media such as ‘The Wall Street Journal’ noted the talks involve spaces currently or formerly occupied by J.C. Penney Co. and Sears Holding Corp., which have been closing stores around the country in the midst of Chapter 11 bankruptcy filings. Neither company confirmed the report back then.

While novel, this alternative seems to struggle to materialise, with many experts voicing their concerns about the real potential for this trend to take off. The latest Prologis research study stated mall anchor redevelopments have become more feasible for such a conversion and retail owners are doing due diligence and considering all conversion opportunities, but primarily multifamily. In this regard, the authors of the report acknowledge the explosive growth of e-commerce during the COVID-19 crisis which “has brought more than five years of evolution in the retail landscape into less than five months of time.”